News and Analysis
Alkegen nears $2bn debt deal led by Oak Hill and Apollo
- Shubham Saharan
- +Rachel Butt
- + 1 more
•2 min read
Alkegen is nearing a debt deal addressing its 2025 maturities with the help of new money lenders including Apollo and Oak Hill Advisors, according to 9fin sources.
The new debt will take the form of a roughly $1.3bn first lien term loan with about $500m of new pari passu notes, two of the sources said. The financing will also include $175m of pari delayed draw term loan debt and a $200m revolver, they added. The new credit facility will be due 2029.
The new first lien debt will be priced at roughly SOFR+300bps cash pay and about 450bps in PIK, those sources said.
Alkegen currently has $700m and €310m in TLB debt due 2025, quoted at 99.18 and 97.67, respectively. It also has $800m in 5.25% senior secured notes due 2028 indicated at 50.82 and $400m in 7.5% senior notes due 2029 indicated at 51.14, according to 9fin data.
The company also had and $84m of availability under its $200m revolving credit facility as of March, per a Moody’s note.
9fin reported in June that certain creditors to the Clearlake-backed company had formalized a cooperation agreement. Moreover, 9fin reported that secured creditors had hired advisors Milbank and Lazard while another lender group organized with Perella Weinberg.
In June, Moody’s downgraded the high-temperature insulation products manufacturer to Caa2 from B3 citing “an unsustainable capital structure considering its very high debt level,” impending maturities, and governance as considerations in its decision, per a note.
Oak Hill declined to comment. Apollo, Clearlake, Alkegen did not respond to requests for comment.
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