ABB Optical Said to Revive Loan Backing New Mountain Dividendby
ABB Optical Group, a contact lens distributor, is reviving an effort to raise a loan that will fund a dividend for its private-equity owner and refinance debt, after a similar effort in October floundered.
Morgan Stanley, the bank arranging the financing has scheduled a meeting with potential lenders for Wednesday, according to a person familiar with the matter.
Proceeds will also refinance a $275 million term loan maturing in February 2019, said the person who asked not to be identified because the deal is private.
In October, the company axed plans for a dividend recap deal that would have included a $400 million term loan, $150 million second-lien term loan and $100 million revolving credit facility, a person with knowledge of the matter said at that time.
After peaking at $69 billion in 2013, loan issuance supporting dividend payments has plunged to less than $3 billion this year as investors shy away from riskier debt, according to data compiled by Bloomberg. In April, McGraw-Hill Education Inc. borrowed $2.33 billion in bonds and loans in part for a $300 million payout for Apollo Global Management. Cengage Learning Inc. sold $620 million of bonds last week in part to pay a $283 million dividend to its private equity owners. The company raised a $1.71 billion loan for the same purposes. Both companies publish textbooks.
ABB Optical is the largest contact lens distributor in the U.S. and is based in Coral Springs, Florida, according to the website of its owner New Mountain Capital.