#STAPLED FINANCING PRO#
#STAPLED FINANCING CRACK#

Given the sweet fees that come from funding leveraged buyouts, a financial adviser might favour the bidders that take advantage of its stapled finance offer. This being the Street, there are new conflicts of interest that come with stapled financings. CIBC World Markets went on to win a starring role in the $1-billion Yellow Pages IPO. Last year, CIBC World Markets served up a stapled finance package as part of its services to BCE Inc., as the conglomerate sold its Yellow Pages division last year to Kohlberg Kravis & Roberts and Teachers Merchant Bank. The same dynamics are now playing out in Canada.

#STAPLED FINANCING CRACK#

Goldman Sachs and Credit Suisse First Boston are masters of this game, and use their combination of M&A expertise and the first crack at funding a deal to freeze out rival lenders that lack the pair's advisory clout. Stapled financing is a made-in-the-USA trend, reflecting the deeper private equity market south of the border. And Merrill Lynch, the family's adviser, joined forces with UBS Securities, Bank of Montreal and Royal Bank to fund the purchase, which involved $800-million of debt. Bain Capital led a group that also includes the Bombardier family and the Caisse de depot et placement du Québec. It would speed up the process.Īs the world now knows, Bombardier's recreational products division did go to a financial buyer. Imagine if your real estate agent offered to hand a mortgage to the person buying your house. So adviser UBS Securities was asked to put together a stapled financing, a debt package that offered buyers assurances on the cost of loans and high-yield bonds that would make the deal go. When Bombardier decided to sell, the company targeted the private equity funds because it wanted a clean, quick deal, with no holdup from competition watchdogs. That may have cost Onex a sweet deal, as the brewer was able to use the time to dig up a friendly offer from Interbrew SA. Back in 1995, Onex ran around for weeks trying to line up backers for its hostile run at John Labatt. Financing used to be a major stumbling block to leveraged private equity deals. LCD’s subscription site offers complete news, analysis and data covering the global leveraged loan and high yield bond markets. This story is taken from analysis which first appeared on an offering of S&P Global Market Intelligence. Under the terms of the agreement, Staples’ stockholders will receive $10.25 per share. Staples (Nasdaq: SPLS) last week disclosed that Sycamore would acquire the company in a $6.9 billion transaction. The transaction is expected to close in 2017. UBS is lead arranger on the term loan, Bank of America is lead arranger on the unsecured bridge, and Wells Fargo is lead arranger on the ABL facility.

#STAPLED FINANCING PRO#

The arranger group has committed $5.2 billion for the financing of the North American delivery segment, which will leverage the pro forma business approximately 4x, sources note.įinancing will comprise a $2.4 billion B term loan, a $1.6 billion unsecured bridge, and a $1.2 billion ABL facility, according to sources. retail, Canadian retail, and the North American delivery business will be separated into standalone entities. UBS, Bank of America Merrill Lynch, Deutsche Bank, Credit Suisse, RBC Capital Markets, Jefferies, Wells Fargo, and Fifth Third Bank are providing the debt financing for the proposed take-private acquisition of Staples, Inc. by Sycamore Partners.Īt close there will be an internal reorganization whereby the U.S.