Danish outsourcing firm ISS has refinanced and amended and extended its debt pile to pave the way for a potential IPO, banking sources said on Monday. Goldman Sachs, Deutsche Bank, Nordea and UBS were advising on the A&E as well as on the refinancing.
ISS has accumulated debt since being bought by private equity firms EQT and Goldman Sachs Capital Partners in 2005. Over the past two years it has paid down a 525 million euro high yield bond due 2014 after a 500 million euro equity investment by Ontario Teachers' Pension Plan and Kirkbi Invest last year.
As part of the refinancing, ISS managed to raise new senior debt totalling around $780 million that will be used to refinance its more expensive 600 million euro ($780 million) second lien facility that was due to mature in June 2015 and paid an interest margin of 375 bps over Euribor, bankers said.
The new senior debt is split between a dollar and euro portion. The dollar term loan totals $350 million and will pay an interest margin of 275 bps over Libor with a 1 percent Libor floor and a 99.75 Original Issue Discount.
The euro term loan of 330 million euros will pay a margin of 350 bps over Euribor with a 99.5 Original Issue Discount, bankers added.
The new loans will allocate and go free to trade on the secondary loan markets this week, bankers said. In addition ISS will extend by three years its existing 2.4 billion Danish Crown ($418 million) revolving credit facility, a 482 million Danish Crown letter of credit that previously matured in December 2014 and its 12.95 billion Danish Crown TLB and 2 billion Danish Crown acquisition facility that previously matured in April 2015, bankers said.
ISS also received consent from its loan lenders for a number of amendments to increase operational and refinancing flexibility as well as introduce some post-IPO flexibilities, bankers said. ISS declined to comment but is expected to comment on the issue after Easter.