November 28, 2019 / 11:02 AM / 12 days ago

MFG launches £186m-equiv loan for dividend payout

LONDON, Nov 28 (LPC) - Private equity-owned UK forecourt operator Motor Fuel Group is looking to raise an extra £186m-equivalent of leveraged loans to pay a dividend to shareholders, banking source said.

BNP Paribas is leading the leveraged loan financing, which was shown to investors on Wednesday.

Clayton, Dubilier & Rice acquired MFG in 2015, it then merged it with peer MRH in 2018.

“MFG has performed well over the past 18 months and deleveraged well since its merger with MRH so the shareholders are looking to take some money off of the table,” a senior banker said.

The new loan will be fungible with MFG’s existing euro term loan B that pays 350bp over Euribor, with a 0% floor.

The new money will be offered with a 25bp OID at 99.75, while existing lenders will be offered a 25bp consent fee for approving a majority lender waiver, to enable the dividend to go ahead.

Investors have been asked to commit to the waiver and the loan by December 6.

The 2018 merger between MFG and MRH was backed with a £700m TLB, paying 450bp over Libor and a €565.44m TLB, paying 350bp over Euribor, as well as a £230m-equivalent RCF and £50m-equivalent letter of credit, according to LPC data.

MRF is the UK’s second-largest independent forecourt operator. (Editing by Christopher Mangham)

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