Lumentum readies launch of $500 million term loan for Wednesday

By Sara Rosenberg

New York, July 23 – Lumentum Holdings Inc. is scheduled to hold a bank meeting at 10 a.m. ET in New York on Wednesday to launch a $500 million seven-year covenant-light first-lien term loan, according to a market source.

Deutsche Bank Securities Inc. is the bookrunner on the deal.

The term loan has a 0% Libor floor, the source said.

Commitments are due on Aug. 7.

Proceeds will be used to help fund the acquisition of Oclaro Inc. for $5.60 in cash and 0.0636 of a share of Lumentum common stock. The transaction values Oclaro at about $1.8 billion in equity value.

Closing is expected in the second half of this year, subject to approval by Oclaro’s stockholders, antitrust regulatory approval in the U.S. and China, and other customary conditions.

Lumentum is a Milpitas, Calif.-based provider of photonics products for optical networking and lasers for industrial and consumer markets. Oclaro is a San Jose, Calif.-based provider of optical components and modules for the long-haul, metro and data center markets.

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