PGS details $527 million bank debt including $150 million new loan

By Paul A. Harris

Portland, Ore., Jan. 21 – Norway-based Petroleum Geo-Services is in the market with up to $527 million first-lien term loan B facilities due March 2024, according to a market source.

The deal includes $377 million outstanding of an existing term loan, which the company proposes to extend by 36 months.

There will also be a new $150 million term loan.

Pricing is partially based on gross leverage: Libor plus 700 basis points at 1.75-times leverage or greater, 650 bps at less than 1.75-times, 600 bps at less than 1.25-times.

The margin increases to 750 bps if ratings fall below B3/B-, and cannot fall below 650 bps unless ratings improve to B2/B or better.

The deal is callable at 101 until March 2021, and 103 thereafter until March 2022, whereupon the premium increases to 105 until maturity. The call premiums apply to repayment in connection with a full or partial refinancing and do not apply to voluntary prepayments from cash flow or available liquidity.

The deal has a 1% quarterly amortization rate during year one, after which that rate steps up to 5%.

Barclays is the agent and lead left arranger. ABN Amro, DNB Markets, JPMorgan and NDA are arrangers.

In addition to the maturity extension on the existing loan, the Lilleakerveien, Norway-based oilfield services provider plans use proceeds to refinance its senior notes due 2020.

The issuing entities will be PGS Finance, Inc. and PGS ASA.

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