KKR Stuffs More Cash in Its Mattress for More Rainy Days - Wall Street Journal Blogs
By Peter LattmanAsk a private-equity pro what they are up to and you will likely get one of the following responses: We’re battening down the hatches. We’re hoping to make it across the icy river. We’re trying weather the storm. (One thing we’ve learned on this beat is that buyout executives toss out cliches with as much vigor as baseball players.)
In less clichéd terms, private-equity firms’ portfolio companies are drowning in debt from boom-era deals, with much of it coming due in the next few years. Rather than wait for looming maturity dates, buyout shops are aggressively working to fix their companies’ capital structures before they implode.
Wednesday, Kohlberg Kravis Roberts performed a little restructuring work on Sealy Corp., which has debt maturities in 2010. The publicly traded mattress maker, which is 50.6% owned by KKR, announced a refinancing to improve liquidity and increase maturity dates. Sealy–with its felicitous stock symbol “ZZ”–said it was repaying all existing credit facilities and replacing them with $350 million in senior secured notes and $177 million in senior secured convertible notes, both due 2016, and an $100 million asset-based loan maturing in 2013.
