KapStone Paper and Packaging Corporation has completed the purchase of Victory Packaging/Golden State Container (Victory).
Headquartered in Houston, TX, Victory is a national distributor of packaging solutions employing 1,500 people.
“The Victory team has grown both revenues and adjusted EBITDA at an impressive 14% compounded annual growth over the past four years,” says Kapstone Roger W. Stone, chairman and CEO.
“Excluding significant new customer wins, the compounded annual growth rate for revenue and adjusted EBITDA has been consistently between 5% and 7%.”
“Victory will enhance KapStone’s growth, profitability, cash flows, and returns to our shareholders.”
Funding for the acquisition came from borrowings under the US$1.915 billion amended and restated senior secured credit facility led by Bank of America, Barclays Bank, and Well Fargo Bank.
The amended facility now consists of Term Loan A-1 of US$940 million maturing over five years, Term Loan A-2 of US$475 million maturing over seven years with 1% amortization in each of the first six years with the remaining principal due at the end of year seven, and a US$500 million revolving credit facility.
The initial blended interest rate will be 1.9% as determined from the LIBOR-based pricing grid, and the rate is subject to change over the life of the loans as LIBOR rates and KapStone’s debt to EBITDA ratio change.
