AM General ups term loan to $330 million, flexes to Libor plus 900 bps

By Sara Rosenberg

New York, March 18 - AM General LLC upsized its five-year term loan B to $330 million from a revised size of $325 million, but the amount is still short of the initial size at launch of $350 million, according to a market source.

Also, pricing on the loan was increased to Libor plus 900 basis points from revised talk of Libor plus 875 bps and initial guidance of Libor plus 650 bps to 675 bps, the source said.

In addition, the Libor floor was moved to 1.25% from a revised amount of 1.5%, putting it back to its original size at launch, the source said.

Furthermore, the loan is non-callable for two years, then at 103 in year three and 101 in year four, versus recently being non-callable for two years, then at 103 in year three and originally having hard call protection of 102 in year one and 101 in year two.

The original issue discount on the term loan is 97. This was widened from 98 upon the first round of changes.

The term loan amortizes at a rate of 10% per annum, revised from 5% earlier, has a 50% excess cash flow sweep, revised from 75% earlier, and has no accordion.

The company's now $350 million senior secured credit facility (B2/BB-), up from a most recent size of $345 million, also includes a $20 million revolver.

Comments are due by 11 a.m. ET on Wednesday and the deal is expected to allocate after that, the source added.

Citigroup Global Markets Inc., BofA Merrill Lynch, Credit Suisse Securities (USA) LLC, Jefferies Finance LLC and Natixis are leading the deal.

Proceeds will be used to refinance existing bank debt.

AM General is a South Bend, Ind.-based designer, manufacturer and supplier of specialized vehicles for commercial and military customers.

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