GE Capital and Lehman Brothers launched syndication last week of a $270 million recapitalization credit for subsidiaries of mattress and pillow manufacturer Tempur World Holdings. The credit includes a $20 million, five-year revolver; a $30 million five-year "A" loan and a $135 million, six-year "B" piece. Lexington, Ky.-based Tempur is also doing a $150 million senior subordinated notes deal in conjunction with the recapitalization. Price talk on the "B" loan is in the LIBOR plus 31/2% range, according to a banker familiar with the deal. The facility also includes a five-year, $20 million revolver and a $65 million "B" loan for European borrowers. A GE official declined to comment and Lehman bankers did not return calls.
Proceeds from the transactions will be used to pay a $158 million dividend to Tempur's shareholders, to fund a $40 million earn-out to former owners and to refinance existing debt. Last fall, private equity firms TA Associates and Friedman, Fleischer & Lowe bought out Tempur for $350 million. The firms tapped GE last October for a $170 million credit to help back the acquisition (LMW, 10/28). The exsisting deal includes a $65 million term loan and a $30 million revolver in the U.S., while the European tranches consist of a $20 million revolver and a $55 million term loan. The banker said Lehman was brought in to co-lead this time around because the "B" loan and notes deal were added. Officials from TA and Friedman, Fleischer either declined to comment or did not return calls.