GenCorp amends loan, permitting second-lien debt and delayed-draw loan

By Sara Rosenberg

New York, Aug. 21 - GenCorp Inc. amended its credit facility, allowing for up to $510 million of second-lien debt and an up to $50 million delayed-draw term loan in connection with the acquisition of Pratt & Whitney Rocketdyne, according to an 8-K filed with the Securities and Exchange Commission on Tuesday.

The delayed-draw loan may also be used, in certain circumstances, for general corporate purposes.

Wells Fargo Bank is the administrative agent on the existing credit facility.

The amendment was completed on Aug. 16.

As was previously reported, GenCorp received a commitment for a $510 million one-year senior unsecured bridge loan that can be replaced with the issuance of senior or subordinated notes.

The company also has the ability to get up to $50 million in additional term loans under its existing credit facility to reduce the bridge loan amount.

Morgan Stanley Senior Funding, Inc. and Citigroup Global Markets Inc. are the lead arrangers on the bridge loan.

Pricing on the bridge loan is Libor plus 750 basis points with a 1.5% Libor floor. After three months, the spread will increase by 50 bps and by another 50 bps every three months thereafter, subject to a cap.

Closing on the $550 million purchase of Pratt & Whitney Rocketdyne from United Technologies Corp. is expected in the first half of 2013, subject to regulatory approvals and other customary conditions.

Based in Sacramento, GenCorp is a technology-based manufacturer of aerospace and defense products and systems with a real estate segment. Pratt & Whitney is a Canoga Park, Calif.-based provider of high-value propulsion, power, energy and innovative system solutions.

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