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Overnite Transportation seeks $300 million loan in connection with IPO
By Sara Rosenberg
New York, Sept. 16 - Overnite Transportation Co. intends to obtain a $300 million credit facility (Ba1) in conjunction with its initial public offering. Credit Suisse First Boston and SunTrust Bank are joint lead arrangers and joint bookrunners on the deal, according to a filing with the Securities and Exchange Commission.
SunTrust Bank will also be administrative agent and collateral agent and Credit Suisse First Boston will also act as syndication agent on the deal.
Syndication of the facility is expected to begin promptly following the commencement of the IPO, the filing said.
The facility is expected to consist of a $125 million five-year term loan and a $175 million five-year revolver, of which up to a maximum of $150 million will be available for the issuance of letters of credit.
The terms of the facility are also expected to provide for an increase to $350 million either by adding additional lenders or by agreeing with existing lenders to increase their commitments.
Security will be a first priority lien on and security interest in all of the capital stock of Overnite Holding, Overnite Inc. and Overnite Transportation, as well as all of the capital stock held by Overnite Transportation and any guarantor under the facility. In the case of any foreign subsidiary, the pledge of its capital stock will be limited to 100% of its non-voting stock, if any, and 65% of its voting stock.
Proceeds from the term loan will be used to part of the cash dividend to Union Pacific Corp. in connection with the spin-off. The remaining portion of the cash dividend will be funded with initial borrowings under the revolver.
Overnite Corp., based in Richmond, Va., operates a less-than-truckload trucking company.
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