St. Louis Park, Minn. Package Finance Deal Yields $270 Million Package Amount

Strategic Insights -

A recently disclosed corporate finance deal in St. Louis Park, Minn., highlights the complexities of syndicated loan agreements. In this transaction, a revolving credit facility and a term loan were issued in the amount of $270 million to a borrower. The loan features various interest rate pricing tiers based on the borrower's credit rating, ranging from Libor + 225 bps to Libor + 300 bps.

Key Takeaways:

  • The loan package, consisting of a revolving credit facility and a term loan, totals $270 million, with the revolving credit facility amounting to $170 million and the term loan amounting to $100 million.
  • The loan features a variable interest rate system tied to the borrower's credit rating, with four pricing levels: Libor + 225 bps, Libor + 250 bps, Libor + 275 bps, and Libor + 300 bps.
  • The pricing of the loan is subject to adjustment based on the borrower's credit rating, with the highest rating (level I) resulting in the lowest interest rate (Libor + 225 bps) and the lowest rating (level IV) resulting in the highest interest rate (Libor + 300 bps).
  • The deal includes a commitment fee for the revolving credit facility, ranging from 32.5 bps to 62.5 bps, based on the borrower's credit rating.
  • The deal also includes a loan-out fee for the revolving credit facility, ranging from 237.5 bps to 312.5 bps, based on the borrower's credit rating.
  • The loan is to be repaid by July 21, 2003, with the revolving credit facility maturing on the same date.
  • Barclays Bank, Chase Manhattan, and several other lenders are participating in this deal as co-agents and other lenders.

Statistics:

  • Package amount: $270 million
  • Revolving credit facility amount: $170 million
  • Term loan amount: $100 million
  • Pricing tiers: Libor + 225 bps (level I), Libor + 250 bps (level II), Libor + 275 bps (level III), Libor + 300 bps (level IV)
  • Commitment fee for revolving credit facility: 32.5-62.5 bps (based on level)
  • Loan-out fee for revolving credit facility: 237.5-312.5 bps (based on level)
  • Maturity date: July 21, 2003

Sources:

  • [No external source was provided]