Carlyle Group LP, the world’s largest private-equity firm, is re-balancing the $4.3 billion buyout financing for DuPont’s auto-paint unit in favor of secured debt in euros at the expense of unsecured dollar debt, according to two people with knowledge of the transaction.
The deal will be the largest buyout financing raised in the U.S. since Kinetic Concepts Inc. obtained a $2.45 billion loan in November 2011 for its purchase by Apax Partners Inc., according to data compiled by Bloomberg.
The seven-year term loan B for Dupont Performance Coatings has increased to 390 million euros ($520 million) from 150 million euros while the secured notes will total 250 million euros, up from 230 million euros, said the people, who declined to be named because the transaction is private. A planned $1.1 billion unsecured high-yield bond is now $750 million in size, said the people.
Leverage, measuring debt to earnings before income, taxes, depreciation and amortization, on a senior secured basis is set to rise to 4.5 times from 4 times, the people said. The size of the dollar-denominated term loan is unchanged at $2.3 billion, they said.
Catherine Armstrong, a spokeswoman in London for Carlyle, declined to comment on the financing.
Barclays Plc, Citigroup Inc., Deutsche Bank AG, Credit Suisse Group AG, Morgan Stanley, UBS AG, Jefferies Group Inc. and Sumitomo Mitsui Banking Corp. are arranging the debt, according to data compiled by Bloomberg.
Carlyle Group is acquiring the business from Wilmington, Delaware-based DuPont for $4.9 billion and the transaction is expected to close during the first quarter, according to an Aug. 30 company statement.