Avago accelerates deadline on $7.5 billion term loan B to Tuesday

By Sara Rosenberg

New York, Nov. 9 – Avago Technologies Cayman Finance Ltd. moved up the commitment deadline on its $7.5 billion seven-year covenant-light term loan B (Ba1/BBB/BBB) to 5 p.m. ET on Tuesday from Thursday, according to a market source.

The term loan B is talked at Libor plus 325 basis points to 350 bps with a 0.75% Libor floor, an original issue discount of 99 and 101 soft call protection for six months.

Amortization on the B loan is 1% per annum.

Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Barclays, Citigroup Global Markets Inc. and Wells Fargo Securities LLC are the arrangers on the deal. Co-managers are BMO Capital Markets Corp., Nomura and Bank of Tokyo-Mitsubishi UFJ.

Proceeds will be used to help fund the acquisition of Broadcom Corp. and to refinance existing debt.

Back in August, the company syndicated via left lead Credit Suisse a $500 million five-year revolver (Ba1) and a $4.25 billion five-year term loan A (Ba1) for the Broadcom transaction.

Pricing on the term loan A, which was upsized during syndication from $3.25 billion, is Libor plus 150 bps to 200 bps, subject to a ratings-based grid.

Under the agreement, Avago will acquire Broadcom for $17 billion in cash consideration and the economic equivalent of about 140 million Avago ordinary shares, valued at $20 billion as of May 27. Broadcom shareholders will own around 32% of the combined company.

Closing is expected in the first quarter of 2016, subject to regulatory approvals in various jurisdictions and the approval of Avago’s and Broadcom’s shareholders.

Avago is a designer, developer and supplier of analog semiconductor devices with headquarters in Singapore and San Jose, Calif. Broadcom is an Irvine, Calif.-based provider of semiconductor solutions for wired and wireless communications.

The combined company will adopt the name Broadcom Ltd.

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