June 13, 2017 / 3:36 PM / a month ago

LPC-Stage Entertainment to raise €335m loan for dividend payout

3 Min Read

LONDON, June 13 (Reuters) - Dutch theatre group Stage Entertainment is looking to raise a €335m loan, the majority of which will be used to fund a dividend, which will finally gift private equity owner CVC a payday having acquired a majority stake in the business in 2015, banking sources said on Tuesday.

CVC bought a 60% stake in Stage Entertainment in 2015 from Dutch media tycoon Joop van den Ende, who retained a minority stake. Joop van den Ende co-founded Endemol in 1993 and then transferred all of its live entertainment activities into Stage Entertainment.

In an unusual move, CVC paid all-equity for the business and aside from a small loan -- from a club of local Benelux banks -- the company has remained debt free, the sources said.

“It is unusual but it was a smallish company and it felt like there were a lot of changes to be made. Sometimes buyout firms buy with 100% equity cheques for competitive reasons or because they feel they may not get the best financing deal, preferring to sit and wait to let a credit prove itself before raising debt,” a senior banker said.

Much of the €335m term loan will be used to pay a dividend to owners as well as to refinance the local loan. Some of it will be put as cash on balance sheet, to help the continued growth of the company, the sources said.

Barclays is leading the financing, alongside ABN Amro, Bank of America Merrill Lynch, ING and Morgan Stanley and a meeting is set to take place to show the deal to lenders on June 15, the sources said.

CVC was not immediately available to comment.

The financing is expected to be welcomed by Europe’s leveraged loan market eager to put new money to work after a number of repricings and refinancings this year.

It will join a growing number of new issuers to launch this week including a €1bn financing backing Advent International’s buyout of European industrial supplies distributor IPH that will combine with Advent-owned peer Brammer and a US$1.225bn-equivalent euro-denominated term loan backing the take private of Hong Kong-based international schools operator Nord Anglia Education.

Editing by Christopher Mangham

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