Alion to launch $340 million facility on Tuesday for buyout by Veritas

By Sara Rosenberg

New York, June 22 – Alion Science and Technology Corp. is scheduled to hold a bank on Tuesday to launch a $340 million first-lien credit facility that will be used to help fund its acquisition by Veritas Capital, according to a market source.

UBS AG is the lead bank on the credit facility.

The facility consists of a $40 million revolver and a $300 million term loan, the source said.

As a result of the new buyout plans, Alion’s in-market deal for $400 million in term loan debt that was going to refinance existing debt was pulled, the source said.

The term debt that was in market consisted of a $280 million first-lien term loan (B1) talked at Libor plus 500 basis points to 550 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, and a $120 million second-lien term loan (Caa1) talked at Libor plus 900 bps to 950 bps with a 1% Libor floor, a discount of 99, and call protection of 102 in year one and 101 in year two.

Jefferies Finance LLC, Credit Suisse Securities (USA) LLC and UBS AG were the leads on the refinancing transaction.

Furthermore, Alion no longer plans on doing an initial public offering, which had previously been expected to price late this month, the source added.

Alion is a McLean, Va.-based research and development, IT and operational services company.

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