Zayo Group downsizes seven-year term loan, upsizes four-year loan

By Sara Rosenberg

New York, Jan. 13 – Zayo Group Holdings Inc. decreased its seven-year term loan to $2 billion from $2.1 billion and increased its four-year term loan to $500 million from $400 million, according to a market source.

Pricing on the seven-year loan is Libor plus 250 basis points with a 1% Libor floor and an original issue discount of 99.75, and pricing on the four-year loan is Libor plus 200 bps with no Libor floor and a discount of 99.75.

The seven-year loan has 50 bps MFN for life and the four-year loan has 100 bps MFN with an 18-month sunset.

Earlier in syndication, the deal was revised from a $2.5 billion seven-year term loan talked at Libor plus 275 bps with a 1% Libor floor and an original issue discount of 99.75.

Morgan Stanley Senior Funding Inc., Barclays, SunTrust Robinson Humphrey Inc., RBC Capital Markets LLC, Citigroup Global Markets Inc., Goldman Sachs Bank USA and J.P. Morgan Securities LLC are the lead banks on the deal.

Proceeds will be used to help fund the acquisition of Electric Lightwave for $1.42 billion in cash and to refinance an existing term loan B.

Other funds for the acquisition will come from $800 million in senior notes.

Closing is expected this quarter, subject to customary regulatory approvals and conditions.

Zayo is a Boulder, Colo.-based provider of communications infrastructure services. Electric Lightwave, formerly known as Integra Telecom, is a Vancouver, Wash.-based provider of infrastructure and telecom services.

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