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Avaya first-lien term loan frees to trade, quoted above upfront fee
By Sara Rosenberg
New York, June 24 – Avaya Inc. upsized its privately placed senior secured convertible note and then its first-lien term loan made its way into the secondary market during Friday’s session.
The company increased its privately placed 8% senior secured convertible note due 2027 to $250 million from $150 million, while leaving the size of its first-lien term loan (B3/B-/BB-) due December 2027 at $350 million, a market source remarked.
Pricing on the term loan is SOFR plus 1,000 basis points with a 1% floor, a par issue price and a 10 points upfront fee. The debt is non-callable for three years, then at 104 in year four, with a bankruptcy make-whole.
Earlier in syndication, the term loan was downsized from $500 million as the convertible note was added to the transaction, pricing was increased from SOFR plus 900 bps, the issue price was changed from 96, the upfront fee was added, the call protection was revised from non-callable for two years, then at 101 in year three, with a bankruptcy make-whole, and changes were made to documentation.
Avaya hits secondary
Recommitments for Avaya’s term loan were due at noon ET on Friday and the debt began trading in the afternoon, with levels quoted at 90˝ bid, 92˝ offered, another source added.
Goldman Sachs Bank USA is the bookrunner on the deal.
Proceeds will be used to prefund the refinancing of the company’s existing $350 million convertible debt due June 2023, to provide additional liquidity for general corporate purposes and to pay transaction fees and expenses.
Avaya is a Santa Clara, Calif.-based provider of communication software and services for enterprises.
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