Walter Investment to launch $475 million add-on term loan on Wednesday

By Sara Rosenberg

New York, Jan. 15 - Walter Investment Management Corp. will be holding a call at 11 a.m. ET on Wednesday to launch a $475 million first-lien add-on term loan due Nov. 28, 2017 to existing lenders only, according to a market source.

Credit Suisse Securities (USA) LLC, Morgan Stanley Senior Funding Inc. and Bank of America Merrill Lynch are the lead banks on the deal.

Pricing on the add-on is Libor plus 450 basis points with a 1.25% Libor floor, in line with existing term loan pricing, the source said.

The original issue discount on the add-on loan is being talked at 99 to 991/2, the source added.

The debt has 101 repricing protection until Nov. 28, 2013.

Commitments are due on Jan. 23.

Proceeds will be used to fund the initial installments for the purchase of the mortgage servicing rights related to the $93 billion in UPB of servicing from Bank of America, and for working capital and general corporate purposes.

"We are confident in our ability to access the debt markets to obtain the necessary funding for the acquisition of the Bank of America MSRs, which enhances our ability to drive shareholder value at attractive terms. This is in line with our expectations for the term loan facilities when they were refinanced last fall. We believe we remain well-positioned to capitalize on the continued secular shifts occurring in the mortgage sector," said Mark J. O'Brien, chairman and chief executive officer, in a news release.

Walter Investment is a Tampa, Fla.-based asset manager, mortgage servicer and mortgage portfolio.

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