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Overnite Transportation $300 million loan to launch Tuesday
By Sara Rosenberg
New York, Sept. 18 - Overnite Transportation Co. is scheduled to hold a bank meeting on Tuesday for its proposed $300 million credit facility (Ba1), which is being obtained in conjunction with its spin-off via an initial public offering, according to a syndicate release. Credit Suisse First Boston and SunTrust Bank are joint lead arrangers and joint bookrunners on the deal.
SunTrust Bank will also be administrative agent and collateral agent and Credit Suisse First Boston will also act as syndication agent on the deal.
As was previously reported, the facility consists 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.
Pricing on the tranches is to be determined, according to the release.
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 pay a portion of the cash dividend to Union Pacific Corp. as part of 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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