This clarifies an earlier version of the LevFin Wrap published earlier today which stated that DSM Engineering is actively pre-marketing a transaction expected to launch post-Easter. Since publication we subsequently learned that the DSM Engineering privately placed its TLB on Friday (31 March).

The leveraged finance primary market had a short week in Europe and unsurprisingly, activity has been muted. However, although most market players are already away, plotting their most challenging hiding spots for the chocolate egg hunt, one European issuer tapped the market again in 2023 with an early hot cross bond.

In the biblical steps of the Lord and Saviour, primary is now expected to resurrect next week, with a flow of European deals hitting investors screens on Tuesday.

Muted M&A pipeline outlier DSM Engineering Materials’ has privately placed a €2.9bn debt package backing sponsor Advent’s buyout, first reported by LevFin Insights and confirmed by a source familiar with the situation. The first real European LBO of 2023 priced €1.15bn in euros and the balance in dollars at a 550bps margin over Euribor and SOFR, respectively, at a 90 OID.

Barclays, BNP Paribas and UBS were the main underwriters on the deal. Sponsor Advent took €450m of the debt, using leverage, with the interest on their portion paid as PIK, to improve DSM’s cash flows. The transaction was marketed off 4.3x senior secured leverage.

The financing supports the carve-out of Royal DSM’s engineering materials business and its merger with LANXESS’ materials business, worth €3.7bn. 9fin first reported in January that the debt package had been slated for syndication in the first quarter.