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LevFin Insights BDC Portfolio News 2/28/22

Posted on March 1, 2022

LevFin Insights

Storable ‒ held by Blackstone, Ares, New Mountain ‒ pursues add-on backing dividend, SOFR shift

Volatility fueled by Russia’s invasion of Ukraine snarled the new-issue loan market this week, driving five loans wider and likely pausing new capital markets business for the next few days as underwriters and investors assess the landscape and work through the loans remaining in market. Twitter managed to jump through an open window in high-yield, but by Thursday the market appeared closed, with BellRing Brands shelving its deal.

Prior to Thursday’s session, a few new loans joined the calendar. Newly launched loans totaled a mere $1.2 billion and $700 million net, via just four deals, but the stat that really shows the current state of play is the flex ratio, in which five deals moved wider all on Thursday and Friday and none tightened as the market traded off.

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 Portfolios in brief: Holds reflect most recent reporting period available

Audax: nThrive (B3/B-/B-) – M&A
J.P. Morgan deepened the OIDs on the $175 million of add-on first- and second-lien term loans for nThrive to 98. Initially, both loans were talked at 98.5-99. The issuer is seeking a $135 million add-on to the first-lien term loan and a $40 million tack-on to the second-lien to fund the acquisition of Pelitas and place cash on the balance sheet. The incremental debt will be fungible with the borrower’s first- and second-lien loans. The existing first-lien due December 2028 is priced at L+400 with a 0.50% floor and carries 101 soft call protection that rolls off in May; the second-lien term loan due December 2029 is priced at L+675 with a 0.50% floor. It is currently callable at 102; the call protection steps down to 101 in November. nThrive’s existing loans, a $1.265 billion first-lien term loan and a $460 million second-lien term loan, were syndicated in November to back the acquisition of TransUnion Healthcare. nThrive earlier this month agreed to purchase Pelitas, a provider of healthcare patient access, digital patient intake and front-end RCM software solutions, for an undisclosed sum. Audax Credit BDC holds about $998K of the existing first-lien debt and $1.5 million of the second-lien term loan due January 2029 (L+775, 0.75% floor)

BCRED, ARCC, NMFC: Storable (B3/B-) – Dividend
Credit Suisse launched a $130 million add-on first-lien term loan for Storable. Proceeds, along with those from a $30 million privately placed add-on to the issuer’s second-lien term loan, would fund a shareholder dividend. The incremental debt is talked at S+350 with a 0.50% floor and a 99 OID. It would be fungible with the borrower’s existing term loan due April 2028. The coupon on the existing loan would be revised from L+325 with the same 0.50% floor, to match the incremental loan; the issuer is offering to reset the 101 soft call protection for six months. Commitments are due by noon ET on Tuesday, March 1. Blackstone Private Credit Fund holds about $1.4 million of the existing first-lien debt, while NMFC Senior Loan Program IV holds roughly $4 million. Ares Capital holds $42.8 million of the existing second-lien loan due April 2029 (L+675, 0.75% floor).

Download LFI BDC Portfolio News 2-28-22 for BDC investment details provided by Advantage Data; click through links to view stories by LFI. – Lisa Allen

lisa.allen@levfininsights.com

Mobile: 408.761.8935

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