Wall Street Stuck With More Buyout Loans as Banks Fund Roper Spinoff

Wall Street Stuck With More Buyout Loans as Banks Fund Roper Spinoff

(Bloomberg) — A group of banks led by UBS Group AG has been forced to fund a portion of the $2 billion of debt they had agreed to provide for the buyout of a unit of Roper Technologies Inc., according to people with knowledge of the matter.

Most Read from Bloomberg

Private equity firm Clayton Dubilier & Rice, which purchased a majority stake in Roper’s industrial operations business, has agreed to buy back a chunk of the debt financing, partly relieving the burden for banks, said the people, who asked not to be identified because the transaction is private.

The deal is the latest in a series of leveraged financings that banks have been forced to fund with their own cash as debt investors pared back risk. Banks have been saddled with more than $40 billion of such debt this year, but have been able to trim their exposure in certain cases by offloading bonds and loans to institutional investors at steep discounts.

Read more: Wall Street’s Hung Debt Swells to $43 Billion as Tenneco Closes

The group of lenders on the CD&R deal, which closed on Tuesday according to a filing, also includes Royal Bank of Canada, BNP Paribas SA, BMO Financial Group, Mizuho Financial Group Inc. and Natixis. The total debt financing was about $2 billion, the filing shows.

Representatives for CD&R, UBS, BNP and Mizuho declined to comment. RBC, BMO and Natixis did not immediately respond to requests for comment.

–With assistance from Paula Seligson and Gillian Tan.

Most Read from Bloomberg Businessweek

©2022 Bloomberg L.P.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *