Technology company TD Synnex has signed US$4.25bn of loans, comprising a US$3.5bn five-year revolving credit facility and a US$750m term loan that is due to mature in September 2027. The US$3.5bn RCF amends and restates the company’s equally sized revolver that was arranged in April 2021. Its size may be increased by up to US$500m. The US$750m term loan was used to partially pre-pay TD Synnex’s originally US$1.5bn term loan that was also agreed in April 2021. The April 2021 loan, which is included within the same credit agreement as the RCF, now features a reduced size of US$581.25m following the pre-payment. It is due to mature in September 2026. The original term loan was borrowed in conjunction with the merger of Synnex and Tech Data to form TD Synnex. Pricing is based on the borrower’s debt rating. For Baa1/BBB+/BBB+ the RCF commitment fee is 10bp and the margin is 100bp, while the term loan margin is 100bp; for Baa2/BBB/BBB it is 12.5bp, 112.5bp and 112.5bp; for Baa3/BBB–/BBB– it is 17.5bp, 125bp and 125bp; for Ba1/BB+/BB+ it is 25bp, 150bp and 150bp; and for lower than Ba1/BB+/BB+ it is 30bp, 175bp and 162.5bp. When originally signed in 2021, the RCF’s commitment fee was between 12.5bp and 30bp and its margin ranged from 112.5bp to 175bp over Libor. For both facilities, the credit spread adjustment is 10bp and covenants restrict TD Synnex’s minimum interest coverage ratio to 3 times. For the RCF, the company’s maximum debt to Ebitda ratio is limited to 4.25 times and for the term loan it is 4 times. Citigroup is the administrative agent for the amended credit agreement. Bank of America holds that role for the term loan. Consenting lenders to the amended credit agreement are Bank of America, Bank of Nova Scotia, Wells Fargo, HSBC, Mizuho, MUFG, SMBC, TD Bank, Credit Agricole CIB, JP Morgan, BNP Paribas, PNC Bank, US Bank, Fifth Third Bank, KeyBank, BBVA, Banco Santander, Capital One, Huntington National Bank, UniCredit, Goldman Sachs, Societe Generale, DBS Bank, SEB, Bank of China, Agricultural Bank of China, Mega International Commercial Bank and Bank of East Asia. Additional lenders to the new term loan are Bank of China, DBS Bank, US Bank, ICBC, China Citic Bank International, China Construction Bank, State Bank of India, Taiwan Cooperative Bank, SMBC, Huntington National Bank, Hua Nan Commercial Bank, Bank of East Asia, Agricultural Bank of China, Mashreqbank, Chang Hwa Commercial Bank, Bank of Taiwan, Credit Industriel et Commercial, Chugoku Bank, Chiba Bank and Mega International Commercial Bank. TD Synnex is rated Baa3 by Moody’s and BBB– by S&P.
Bellwether