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Avis cuts spread on $420 million term loan B to Libor plus 500 bps
By Sara Rosenberg
New York, Sept. 20 - Avis Budget Group Inc. reduced pricing on its $420 million seven-year term loan B (Ba1) to Libor plus 500 basis points from Libor plus 525 bps, according to a market source.
Additionally, the Libor floor was lowered to 1.25% from 1.5% and the original issue discount firmed at 98, the tight end of the 97 to 98 talk, the source said.
There is still 101 soft call protection for one year.
Commitments were due end of day Tuesday, and allocations are expected to go out on Wednesday.
Morgan Stanley & Co., Citigroup Global Markets Inc., Credit Agricole Securities (USA) Inc., Scotia Capital (USA) Inc. and RBS Securities Inc. are the lead banks on the deal.
Proceeds will be used to help fund the acquisition of Avis Europe plc for £3.15 in cash per share. The transaction is valued at £635 million, or about $1 billion.
Closing is expected to take place in October, subject to Avis Europe shareholder approval, court approval and regulatory clearances.
Parsippany, N.J.-based Avis Budget and Bracknell, England-based Avis Europe are vehicle rental companies.
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