Oshkosh sets Nov. 9 launch for $3.5 billion credit facility

By Sara Rosenberg

New York, Nov. 1 - Oshkosh Truck Corp. has scheduled a bank meeting for Nov. 9 to launch its proposed $3.5 billion senior credit facility, according to a market source.

Bank of America and JPMorgan are the lead banks on the deal.

The facility consists of a $500 million five-year revolver, a $400 million five-year term loan A and a $2.6 billion seven-year term loan B, the source said.

Oshkosh has previously said that it is anticipating a weighted average interest rate of 7.7% on the new debt, with just under $3.3 billion to be funded at close.

Proceeds will be used to fund the acquisition of JLG Industries, Inc. for $28.00 per share. Total consideration, including transaction costs and assumed debt, is $3.2 billion in cash on a fully diluted basis.

The company expects to pay down $300 million or more annually by fiscal 2008, bringing the debt to EBITDA ratio down to around 3 times by Sept. 30, 2008 from the upper-4s at closing of this transaction.

Oshkosh Truck is an Oshkosh, Wis., designer, manufacturer and marketer of specialty commercial, fire and emergency and military vehicles and bodies. JLG is a McConnellsburg, Pa., manufacturer of access equipment, including aerial work platforms and telehandlers.

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