Debt Restructurings For All But a Few Mega-Deals

With today’s news of Blackstone’s plans to swap debt for equity in portfolio company Hilton Hotels, I imagined just about all of the top ten largest LBOs have now undergone some sort of debt-fixing deal. To be sure, I checked in on each of them and a few other well-known mega-deals, excluding those already exited like TPG’s Alltel and of course, KKR’s RJR Nabisco.

As it turns out, all but a few have done something to ease their debt situation. From my research, First Data. Kinder Morgan, and Equity Office Properties have not publicly undergone any major debt restructurings.

Here’s a look at those who have:

TXU (Now Energy Future Holdings): Struggles to drum up participation for proposed $12.15 billion debt swap on its $43 billion in debt.
Sponsored by Kohlberg Kravis Roberts & Co and TPG Capital

Harrah’s –Issued a new $1 billion note to retire a portion of Harrah’s existing term loan and revolving credit indebtedness.
Sponsored by TPG and Apollo Management

Kinder Morgan – Buyouts estimated the company had a modest median long term debt-to-LTM EBITDA of 5.0.
Sponsored by GS Capital and Carlyle/Riverstone.

First Data, Toys R Us, and HCA –The three companies, all backed by KKR, were named as IPO candidates by a recent FT report.
First Data will benefit from a listing before 2011, when KKR’s PIK notes convert to cash pay.

HCA offered $1.25 billion of senior secured notes in order to pay down term loans, in July.
Toys ‘R Us also refinanced and extended its debt, the firm has said.
Sponsored by KKR
Freescale Semiconductor –Sued by bondholders over $4 billion distressed debt swap, which “unjustly enriched” noteholders because they have swapped nearly worthless notes for a valuable term loan backed by collateral.
Sponsored by Carlyle Group

Hilton – Proposed debt for equity swap today on $5 billion of $20.6 billion in debt.
Sponsored by Blackstone Group

Clear Channel – The New York Post reported that the company was struggling to arrange a debt swap, which the firms later denied.
Sponsored by Bain Capital and THL Partners

Realogy- raised around $650 million of second lien loans to pay part of its $750 million revolver and refinance $220 million of senior toggle notes.
Sponsored by Apollo Management

Neiman Marcus- Chose to PIK its PIK-toggle to cover debt payments in April.
Sponsored by TPG Capital and Warburg Pincus

Those who haven’t:

Kinder Morgan – Buyouts estimated the company had a modest median long term debt-to-LTM EBITDA of 5.0.
Sponsored by GS Capital and Carlyle/Riverstone.

Equity Office Properties Trust: Somehow has not
Sponsored by Blackstone

First Data-See above.
Sponsored by KKR

Alltel –Sold to Verizon in 2008.
Sponsored by TPG