Avaya to launch some of its $3.8 billion term loan B on Tuesday

By Sara Rosenberg

New York, July 18 - Avaya Inc. is scheduled to hold a bank meeting on Tuesday to launch a portion of its $3.8 billion term loan B (Ba3/B) that was funded last fall, according to a market source.

The term loan B is priced at Libor plus 275 basis points.

Morgan Stanley and JPMorgan are holding the meeting, with Morgan Stanley leading the process.

Citigroup was the left lead bank on the deal when it was first done, but sources said that the bank is rumored to have sold out its portion of the tranche. Back in March, Citigroup did approach some lenders about the B loan and was guiding the original issue discount around 88, but whether the debt sold at that level is unavailable.

Proceeds from the term loan B were used to help fund the buyout of the company by Silver Lake and TPG Capital for $17.50 in cash per share. The transaction was valued at $8.2 billion.

The term loan B is part of a $4.335 billion credit facility that also includes a $335 million six-year asset-based revolver priced at Libor plus 175 bps, with a 25 bps commitment fee, and a $200 million six-year multi-currency revolver (Ba3/B) priced at Libor plus 275 bps, with a 50 bps commitment fee.

Avaya is a Basking Ridge, N.J., provider of communication systems, applications and services.

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