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HHI Group Holdings, completes third successful recapitalisation in last year

KPS Capital Partners’ portfolio company, HHI Group Holdings, LLC has completed a third successful recapitalization in the last twelve months. HHI raised USD425 million of new financing, including a USD100 million asset based revolving credit facility and a USD325 million term loan.


The proceeds of the recapitalisation were used to refinance outstanding debt, to fund a USD100 million cash distribution to stockholders and to fund the company’s continued growth.

Following the recapitalization, HHI remains conservatively capitalised with the continued support of KPS, its majority stockholder.  KPS and minority stockholders, including MC Capital Inc. (a subsidiary of Mitsubishi Corp.) and HHI management, continue to own 100% of HHI’s common stock.

HHI has completed three recapitalisations in less than one year.  HHI completed a USD300 million recapitalization on March 31, 2010 and a USD30 million upsizing of its term loan on October 1, 2010. The combined proceeds of the three recapitalisations, as well as the Company’s strong cash flow, resulted in more than USD300 million in cash distributions to stockholders.

The financing was provided by a syndicate of banks and institutional investors with Bank of America Merrill Lynch acting as Sole Lead Arranger on the USD100 million asset based revolving credit facility, and Bank of America Merrill Lynch, Goldman Sachs and Credit Suisse acting as Joint Lead Arrangers on the USD325 million term loan.

Jenner & Block LLP served as legal counsel to HHI with respect to the recapitalization.

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