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News Corp. enters credit agreement for up to $1.25 billion
By Wendy Van Sickle
Columbus, Ohio, March 30 – News Corp. entered into an unsecured credit agreement on Tuesday with Bank of America, NA as administrative agent, providing for $1.25 billion of credit facilities in two five-year parts, according to an 8-K filed with the Securities and Exchange Commission.
The tranches include a $750 million revolver and a $500 million term loan A.
The revolver has a $100 million sublimit for letters of credit.
The company may request up to $250 million of additional term or revolving loans.
The term loan will amortize in equal quarterly installments in an aggregate annual amount equal to 0.0%, 2.5%, 2.5%, 5% and 5%, respectively, of the original principal amount for each 12-month period starting June 30.
The revolver may be extended for up to two one-year periods, and the term loan may be extended under certain circumstances for at least one year.
Borrowings will bear interest at term SOFR plus a margin that is initially 137.5 basis points and may range up to 225 bps, depending on the leverage ratio. The commitment fee is initially 20 bps and may range up to 30 bps.
The company must maintain an adjusted operating income net leverage ratio of not more than 3.0 to 1.0, subject to adjustment following a material acquisition, and a net interest coverage ratio of not less than 3.0 to 1.0.
The term loans will be borrowed Thursday. The revolver is undrawn.
BofA Securities, Inc., JPMorgan Chase Bank, NA, Citibank, NA, Morgan Stanley MUFG Loan Partners, LLC, Deutsche Bank Securities Inc., Goldman Sachs Bank USA, HSBC Bank USA, NA and Bank of China, New York Branch acted as joint lead arrangers.
BofA, JPMorgan and Citibank are syndication agents and joint bookrunners.
The media conglomerate is based in New York City.
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