Deutsche Bank is in the market with a $245 million bank facility for Consolidated Container Co. The credit, which is only going out to existing lenders, comprises a $200 million term loan at LIBOR plus 3 1/2% and a $45 million revolver at LIBOR plus 3 3/4%. There are also $170 million of second-lien floating rate notes, which have not yet priced, a loan investor said.
Proceeds, along with $10 million of cash on hand, will be used to partially refinance the company's existing credit facility, which has $391 million outstanding. In addition, parent company Consolidated Container Holdings will downstream proceeds from an approximately $45 million preferred stock offering.
Moody's Investors Service expects financial covenants to address maximum first-lien leverage, maximum secured leverage, minimum interest coverage and limitations on capital expenditures. For the first three years, interest payments are intended to be payment-in-kind and the notes will be non-callable, Moody's adds. Pro forma leverage is 6.5 times. Consolidated Container manufactures rigid plastic containers. Tyler Woolson, Consolidated Container's cfo, did not return calls by press time.