LONDON Aug 28 Bankers are preparing debt
financings to back a number of potential sales that could
provide a big boost to the leveraged finance market in the last
quarter of 2014 and soak up some of the demand from cash rich
investors hungry for event driven deals, banking sources said.
Bids are due on several sale processes in September and
bankers are working on financings totalling around 5 billion
euros (6.58 billion US dollar) for companies including Gala
Coral's bingo division; Germany's largest private-sector chain
of rehabilitation clinics Median Kliniken; Norwegian cable group
Get; Slovenia telecom firm Telekom Slovenije ; Swiss
drink cartons maker SIG Combibloc Group; and Danish crop
protection company Cheminova.
The companies were either not immediately available to
comment or declined to comment.
"All of these companies should attract a lot of interest
from potential buyers and debt investors - all eager to do deals
and put money to work," a leveraged finance banker said.
Lazard is running the sale of Gala's 135 bingo clubs which
is attracting interest from a number of potential buyers and
final round bids are due September 15. With Ebitda of around 50
million pounds (82.89 million US dollar), bankers are putting
together all-senior leveraged loan financings of around 4.5
times debt to earnings, totalling around 225 million pounds.
Bankers are also working on financings of up to around 600
million euros or 6.5-7 times debt to earnings for Median, owned
by buyout firm Advent International and British real estate
investor Marcol. Debt is expected to be in the form of first and
second lien loans.
Get owners Quadrangle and GS Capital Partners had considered
a sale of the company in 2012 but opted to conduct a dividend
recapitalisation instead. The company is now up for sale with
bids due shortly and bankers are considering senior loans,
second lien loans and high yield bonds to back a deal.
About 2.8 billion euros of debt has been put together to
back a potential sale of SIG Combibloc Group, while debt
financings of up to 720 million euros to back a potential sale
of Cheminova are also being prepared, with final bids for the
business due September 4.
Broadcasting masts group TDF's French unit looks likely to
be sold to Canadian pension fund PSP Investment, banking sources
Bankers are preparing around 1.5 billion euros to back PSP's
bid or 4 times debt to earnings, in the form of an
infrastructure, corporate style loan. Some bankers are
disappointed the financing will not be in the form of leveraged
loans, which would have totalled around 2.65 billion euros.
(1 US dollar = 0.7598 euro)
(1 US dollar = 0.6032 British pound)
(Editing by Christopher Mangham)