Adesa buyout financing to include $1.79 billion facility, $1.1 billion bonds

By Sara Rosenberg

New York, Jan. 25 - Adesa Inc. detailed its leveraged buyout financing package, including that there will be a $1.79 billion senior secured credit facility and $1.1 billion of high-yield bonds, according to a PREM14A filed with the Securities and Exchange Commission Thursday.

Bear Stearns, UBS, Goldman Sachs and Deutsche Bank are the lead banks on the financing.

The credit facility will consist of a revolver and term loan debt.

As a backup for the bonds, the company has received a commitment for a $600 million senior unsecured bridge loan and a $500 million senior subordinated unsecured bridge loan.

Adesa is being acquired by Kelso & Co., GS Capital Partners, ValueAct Capital and Parthenon Capital for $27.85 per share in cash.

As part of the transaction, Insurance Auto Auctions, Inc., a Kelso and Parthenon Capital-owned provider of automotive salvage auction and claims processing services, will be combined with Adesa.

The total transaction value, including the contribution of Insurance Auto, the assumption or refinancing of about $700 million of debt and the payment of related fees and expenses, is $3.7 billion. The contemplated refinancing is expected to include the defeasance of Adesa's existing 7 5/8% senior subordinated notes due 2012 and a tender offer for Insurance Auto's existing 11% senior notes due 2013.

Adesa is a Carmel, Ind., provider of wholesale vehicle auctions and used vehicle dealer floorplan financing.

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