American Tower releases details on new $1.5 billion term loan

By Marisa Wong

Madison, Wis., Oct. 30 - American Tower Corp. disclosed details on its new $1.5 billion unsecured term loan due Jan. 3, 2019 in an 8-K filed Wednesday with the Securities and Exchange Commission.

American Tower entered into the term loan agreement on Tuesday with Royal Bank of Scotland plc as administrative agent, Royal Bank of Canada and TD Securities (USA) LLC as co-syndication agents, JPMorgan Chase Bank, NA, Morgan Stanley MUFG Loan Partners, LLC, CoBank, ACB, Barclays Bank plc and Citibank, NA as co-documentation agents and RBS Securities Inc., RBC Capital Markets, LLC, TD Securities, J.P. Morgan Securities LLC and Barclays Bank as joint lead arrangers and joint bookrunners.

Interest is equal to Libor plus 112.5 basis points to Libor plus 225 bps. The margin is based on the company's debt ratings. The current rate is Libor plus 125 bps.

As noted before, the term loan does not require amortization of principal, and it may be paid prior to maturity in whole or in part at the company's option without penalty or premium.

According to the 8-K, the loan agreement contains financial ratios and operating covenants, including a total leverage ratio of not greater than 6.5 to 1 until Sept. 30, 2014 and not greater than 6 to 1 after that and a senior secured leverage ratio of not greater than 3 to 1.

In addition, if the company's debt ratings fall below a specified level as of the end of any fiscal quarter, the company must maintain an interest coverage ratio of not less than 2.5 to 1 for as long as those ratings remain below the specified level.

The loan proceeds and cash on hand were used to repay the company's existing $750 million unsecured term loan and $800 million of outstanding debt under its $1 billion unsecured revolving credit facility.

American Tower owns, operates and develops wireless communications sites and is based in Boston.

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