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Midcontinent firms $350 million term B spread at Libor plus 450 bps
By Sara Rosenberg
New York, July 30 - Midcontinent Communications finalized pricing on its oversubscribed $350 million 61/2-year term loan B at Libor plus 450 basis points, the tight end of the initial Libor plus 450 bps to 475 bps talk, according to a market source.
In addition, a step-down to Libor plus 425 bps was added to the term loan B once leverage drops below 3.5 times, the source said.
The term loan B still has a 1.75% Libor floor, an original issue discount of 98½ and 101 soft call protection for one year.
The company's $675 million senior secured credit facility (B1/B+) also includes a $125 million 51/2-year revolver and a $200 million 51/2-year term loan A, with both of these tranches priced at Libor plus 400 bps. The revolver has a 50 bps unused fee.
Allocations are expected to go out and closing is expected to take place during the week of Aug. 2.
SunTrust, Wells Fargo, US Bank and RBC are the joint bookrunners on the deal, with SunTrust the left lead. CoBank and Bank of America have signed on as agents.
Proceeds will be used to fund a $320 million distribution to the partnership, refinance about $230 million of debt and for general corporate purposes.
Midcontinent Communications is a partnership that was formed in April 2000 as a joint venture between Midcontinent Media Inc. and Comcast Corp.
The company's founder, Larry Bentson, passed away in 2009 and left the business to its three top officers. As part of the estate settlement, the company has to pay $160 million to the estate and $160 million to Comcast - the $320 million distribution that the credit facility will finance.
Midcontinent Communications is a Minneapolis-based provider of cable television, local and long-distance digital telephone service and high-speed internet access.
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