Skype Technologies floats potential timing; Allen Systems releases guidance; Ford steady

By Sara Rosenberg

New York, Sept. 2 - Some details surfaced on Wednesday as to the possible timing for the launch of and structure on Skype Technologies SA's credit facility that will help fund a buyout of a majority stake in the company by a group of investors.

In more new deal happenings, Allen Systems Group Inc. came out with price talk on its proposed credit facility as the deal is gearing up for its launch into syndication late next week.

Meanwhile, over in the secondary market, Ford Motor Co.'s term loan was steady during market hours after moving around a little during the previous session with August sales results.

Skype seen as September business

Market talk emerged that Skype Technologies is targeting holding a bank meeting during the week of Sept. 14 to launch its proposed credit facility, a market source told Prospect News on Wednesday, adding that a firm date has not yet been established.

The credit facility is expected to consist of a roughly $600 million term loan and a revolver, the source said. The size of the revolver is not yet public and it's possible that the revolver will not be syndicated.

JPMorgan, Barclays and RBC Capital Markets are the lead banks on the deal.

Proceeds will be used to help finance the purchase of a 65% stake in the company by an investor group led by Silver Lake and including Index Ventures, Andreessen Horowitz and the Canada Pension Plan Investment Board.

eBay Inc., the current owner of Skype, will retain a 35% interest in the company.

Skype also using equity

Other funds for the buyout of Skype will come from equity from both the buying group and the seller, the source remarked.

eBay is expected to receive about $1.9 billion in cash upon the completion of the sale and a subordinated note from the buyer in the principal amount of $125 million. The transaction values the company at $2.75 billion.

The acquisition, which is not subject to a financing condition, is expected to close in the fourth quarter.

Skype generated revenues of $551 million in 2008, a 44% increase compared to 2007, and registered Skype users reached 405 million by the end of 2008, a 47% increase from 2007.

In addition, eBay has projected that Skype revenues will exceed $1 billion in 2011.

Skype is a Luxembourg-based software that enables individuals and businesses to make free video and voice calls, send instant messages and share files with other Skype users.

Allen Systems reveals talk

Allen Systems Group has been circulating price talk on its proposed $355 million credit facility as the company is getting ready to kick off syndication on the deal with a bank meeting scheduled for Sept. 10, according to a market source.

The $235 million four-year term loan B is being talked at Libor plus 550 basis points and the $100 million 41/2-year second-lien term loan is being talked at Libor plus 800 bps plus 200 bps PIK, the source said.

Both the term loan B and the second-lien loan carry a 3% Libor floor.

The facility also includes a $20 million three-year revolver.

Bank of America is the lead bank on the deal that will be used to refinance existing debt.

Allen Systems is a Naples, Fla.-based enterprise software provider.

Ford stabilizes

Ford's term loan was unchanged on the day after moving downwards on Tuesday following the release of August sales numbers that were lower than expected, according to a trader.

The Dearborn, Mich.-based automotive company's term loan was quoted at 86 bid, 87 offered, unchanged from Tuesday's levels. On Monday, the loan was seen at 86½ bid, 87½ offered.

For the month of August, total Ford sales, including Volvo, were 182,149, up 17% from 155,690 in August 2008.

Total Ford, Lincoln and Mercury sales for the month were 176,323, up 16.8% from 151,021 last year.

Total car sales for the month were 65,654, up 24.6% from 52,677 in the comparable prior-year period.

And, total truck sales were 110,669, up 12.5% from 98,344 in August 2008.

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