Warner Music flexes $600 million term loan to Libor plus 400 bps

By Sara Rosenberg

New York, Oct. 25 - Warner Music Group Corp. (WMG Acquisition Corp.) lowered pricing on its $600 million six-year first-lien covenant-light term loan to Libor plus 400 basis points from talk of Libor plus 475 bps to 500 bps, according to a market source.

The 1.25% Libor floor, original issue discount of 99, 101 soft call protection for one year and 5% per annum amortization were left unchanged.

The company's $750 million credit facility (Ba2/BB-) also provides for a $150 million revolver.

Recommitments were due at 1 p.m. ET on Thursday, the source said.

Credit Suisse Securities (USA) LLC, UBS Securities LLC, Barclays, Macquarie and Nomura are the lead banks on the deal.

Proceeds will be used to refinance existing debt.

The company is also getting a $727 million equivalent of senior secured notes that were upsized from $635 million.

At the time of the bond upsizing on Wednesday, the term loan was downsized from $630 million.

The additional debt raised between the term loan downsizing and the bond upsizing totals about $60 million. That debt will be used to reduce the amount of cash used for the refinancing.

Warner Music is a New York-based music content company.

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