$130m (+18m) sub cb coming tonight from MER. Terms: 7yr, 2.75-3.25% up 27.5-32.5%, full pctns. UOP = repay jun/sub cb & facility. $340m funeral home & cemetery operator (161 f/homes in 26 states & 31 cemeteries in 10 states) Co has history of acq smaller ops ($83m in last 3 years). Much larger comp = $4B SCI which does 13.5x more ebitda w/2020 BB- sen unsec str8 ~L250.
PF Cash – 15m
PF Debt – 262m
(120m cb, 142m 09/17 first lien secured bank debt)
LTM EBITDA = 52m, FCF 29m, lev = 5x.
We’d assume L+600 for 7 yr. ADV = 340m, no leaps, 1y 100d = 33 vol.
Small market cap, v low ADV, low sbv/7yr structure = we’d discount vol to 30%. Theo = 101.2.
7yr sub cb not an ideal structure 4 credit so some may not be dying to get involved. Flip side = mkt needs paper, small deal, this will get placed.