AUD tranches take bigger share of Australian TLB volumes in 2021 for first time

Data InsightDebtDynamics 17 February

AUD tranches take bigger share of Australian TLB volumes in 2021 for first time

The volume of AUD-denominated Term Loan Bs (TLB) Australian companies obtained last year exceeded for the first time their TLB borrowings in all other currencies combined.

Australian companies obtained AUD 3.4bn (USD 2.52bn-equivalent) in AUD-denominated TLBs last year, accounting for 58% of the total USD 4.35bn-equivalent TLBs raised during the period. The rest was all in USD. In the previous six years, AUD-denominated TLBs made up a relatively smaller portion of the overall annual TLB borrowings – from a low of 20.2% in 2017 to a high of 37.5% in 2019.

The volume of AUD-denominated TLBs so far this year has reached AUD 1.246bn (USD 896m-equivalent). That comprises a AUD 786m first-lien TLB tranche of a total AUD 1.165bn loan priced last week to back EQT Partners’ proposed buyout of cancer-care provider Icon Group; and a AUD 460m first-lien TLB, part of a AUD 600m loan closed last month that supported KKR’s acquisition of a majority stake in business-process-outsourcing firm Probe CX.

Last year, a AUD 1.85bn-equivalent TLB to support a Macquarie Infrastructure and Real Assets-Aware Super consortium’s buyout of fiber-network provider Vocus Group was priced with AUD 925m and USD 725m tranches, despite initially having set a price guidance on a EUR tranche during syndication.

A AUD 1.51bn-equivalent TLB to fund KKR’s acquisition of a 55% stake in wealth manager Colonial First State Investment was targeting USD 735m on the USD portion during syndication but was later downsized to USD 450m, while the AUD portion was increased to AUD 890m at pricing.

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