June 1, 2012 / 2:35 PM / 6 years ago

RLPC: Kronos increases rate, adds back covenant

NEW YORK, June 1 (Reuters) - Kronos Worldwide Inc has bumped up the rate on its $600 million, seven-year term loan B, sources told Thomson Reuters LPC.

Pricing is now 425bp over Libor with a 1 percent Libor floor and a discount of 99 cents on the dollar. At launch, the loan was guided at 375bp over Libor with the same Libor floor and discount.

The loan will now amortize at 5 percent per year, up from the original proposal of 1 percent per year. The issuer has also added financial covenants to the originally covenant-lite loan. The loan now features a net leverage ratio of 3.5 times. As previously reported, Wells Fargo leads the credit, which is rounded out by a $125 million, five-year revolver.

Proceeds will be used to refinance around 280 million euro of outstanding notes due 2013 at subsidiary Kronos International Inc (KII), Kronos said in a statement. The remaining proceeds would be used for general corporate purposes, which could include the payment of a special dividend of up to $1 per share. The corporate family rating is Ba2, while the facility rating is Ba3.

Kronos Worldwide Inc is an international producer of titanium dioxide products.

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