Avaya increases pricing on extended term loan to Libor plus 450 bps

By Sara Rosenberg

New York, Feb. 1 - Avaya Inc. increased pricing on its proposed extended term loan debt to Libor plus 450 basis points from earlier talk of Libor plus 425 bps and added 101 soft call protection for one year, according to a market source.

In addition, the amendment fee being offered to lenders was increased to 25 bps from 10 bps, the source said.

Under the amendment and extension proposal, the company is looking to extend 50% of its term loan B-1 to 2017 from 2014.

As of Sept. 30, there was $3.662 billion outstanding under the term loan B-1 priced at Libor plus 275 bps.

In addition, the amendment would carve out a basket to allow for additional senior secured debt in the form of loans or bonds and the company would have the option to use that debt to repay whichever term loan tranche it wants first. The expectation is that the term loan B-2 would be paid down first, then the B-1 and then the B-3.

Citigroup, JPMorgan and Morgan Stanley are the lead banks on the amendment and extension.

Responses were due on Tuesday.

Avaya is a Basking Ridge, N.J.-based enterprise communications systems, software and services company.

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