Ocwen Loan Servicing sets discount on $350 million term loan at 98

By Sara Rosenberg

New York, July 8 - Ocwen Loan Servicing LLC firmed the original issue discount on its $350 million senior secured term loan (B1/B/BB-) at 98, the wide end of the initial 98 to 99 guidance, according to a market source.

As before, pricing on the term loan is Libor plus 700 basis points with a 2% Libor floor, and there is 101 soft call protection for one year.

Barclays and Deutsche Bank are the joint bookrunners on the deal, with Barclays the lead arranger.

Allocations are expected to go out early next week.

Proceeds will be used to help fund the purchase of Barclays Bank plc's HomEq Servicing, a U.S. mortgage servicing business, for $1.3 billion in cash.

As part of the agreement, Barclays has agreed to provide Ocwen with a $905 million servicer advance facility.

Closing on the acquisition is expected to take place in the third quarter, subject to customary conditions, including competition clearance.

Ocwen Loan Servicing is a subsidiary of Ocwen Financial Corp., a West Palm Beach, Fla.-based provider of residential and commercial loan servicing, special servicing and asset management services.

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