Banking Giants Line Up $7.9 Billion Debt Package to Fuel CD&R's Sealed Air Buyout
A consortium of major banks is finalizing a massive debt package worth approximately $7.9 billion to fund Clayton, Dubilier & Rice's (CD&R) acquisition of packaging giant Sealed Air Corp, the company behind the iconic Bubble Wrap, according to a Bloomberg report. The financing push signals a key step forward for one of the largest leveraged buyouts in the industrial packaging sector this year.
The transaction, which sources indicate could launch as soon as this month, will see JPMorgan Chase and Wells Fargo spearhead a high-yield bond offering. Market expectations peg the bond yields between 7% and 7.25%, a rate that reflects current market conditions for leveraged buyout debt. In addition to the bonds, the financing structure includes roughly $4.5 billion in leveraged loans denominated in both US dollars and euros.
The broader banking syndicate features prominent names including BNP Paribas, Goldman Sachs Group, and UBS Group, with Mizuho Financial Group, Citigroup, and Royal Bank of Canada also providing committed financing. Preliminary discussions with institutional investors are reportedly underway to gauge appetite for the debt, which is crucial for closing the $10.3 billion enterprise value deal announced last November.
Analysts note the financing's structure—combining high-yield bonds with leveraged loans—is typical for large-scale private equity transactions but arrives at a time when debt costs remain elevated compared to the low-rate era. The loans are expected to be priced at a margin of approximately 300 basis points over the Secured Overnight Financing Rate (SOFR).
Upon completion, anticipated by mid-2026, Sealed Air will transition to private ownership, ending its listing on the New York Stock Exchange while maintaining its headquarters in Charlotte, North Carolina. The move is seen as part of CD&R's strategy to reshape the company away from public market pressures.
Market Reaction & Commentary:
Michael Thorne, Portfolio Manager at Hartford Capital: "This is a textbook large-cap LBO financing. The 7%+ yield on the bonds is attractive in today's environment and should see solid demand from yield-seeking fixed income funds. It underscores the continued liquidity available for quality assets with strong cash flows, even in a higher-rate world."
David Chen, Senior Analyst at ClearView Research: "The deal highlights private equity's enduring appetite for stable, cash-generative industrial businesses. Sealed Air's market-leading positions in protective and food packaging provide the predictable earnings needed to service this debt. The key will be CD&R's operational playbook to drive growth under the weight of this leverage."
Sarah Gibson, Editor at Debt Market Watch: "Another multi-billion dollar debt dump onto the market to fund a financial engineering play. Banks are loading a historic, innovative company with debt that will inevitably lead to job cuts and reduced R&D. It's short-term profit for funds at the long-term expense of the company's resilience and its workforce. When will this cycle end?"
Robert Flynn, Former CFO of a Packaging Competitor: "Going private gives Sealed Air room to execute a longer-term transformation, especially in sustainability, without quarterly scrutiny. However, the debt load is significant. Success hinges on flawless execution and stable macroeconomic conditions over the next few years."
Officials from CD&R, Sealed Air, and the involved banks have declined to comment on the financing specifics, noting that details remain subject to change. The deal, once closed, will mark a new chapter for the 64-year-old packaging innovator.