USI Insurance talks $1.03 billion term loan at Libor plus 400-425 bps

By Sara Rosenberg

New York, Dec. 6 - USI Insurance Services launched on Thursday its $1.025 billion seven-year covenant-light term loan B with price talk of Libor plus 400 basis points to 425 bps with a 1.25% Libor floor and an original issue discount of 99, according to a market source.

The term loan B has 101 soft call protection for one year and amortizes at a rate of 1% per annum.

The company's $1.175 billion credit facility (B1) also includes a $150 million five-year revolver.

Bank of America Merrill Lynch, Morgan Stanley Senior Funding Inc., Citigroup Global Markets Inc., Goldman Sachs & Co., RBC Capital Markets LLC and UBS Securities LLC are the lead banks on the deal.

Proceeds will be used to help fund Onex Corp.'s purchase of the company from GS Capital Partners VI Fund LP for about $2.3 billion.

Other funds for the transaction are expected to come from the issuance of over $600 million in bonds.

Employees of USI invested alongside GS Capital Partners in a take-private of the company in 2007. They will remain significant investors in the company going forward.

Closing is expected by year-end, subject to customary conditions and regulatory approvals.

USI is a Briarcliff Manor, N.Y.-based insurance broker.

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