ADT talks $3.03-$3.28 billion term loan B at Libor plus 300-325 bps

By Sara Rosenberg

New York, Sept. 4 – ADT Inc. (Prime Security Services Borrower LLC) is talking its $3.025 billion to $3.275 billion seven-year senior secured term loan B at Libor plus 300 basis points to 325 bps with a 0% Libor floor and an original issue discount of 99, according to a market source.

The term loan has 101 soft call protection for six months and a springing maturity to 90 days inside the maturity date of any applicable debt.

Negative covenants are substantially consistent with the existing credit agreement, with certain updates to provide for additional strategic and financial flexibility, including amendments to the limitations on incremental indebtedness, investments and restricted payments, the source said.

The loan is set to launch with a lender call at 11 a.m. ET on Thursday.

Barclays is the lead bank on the deal.

Commitments are due at noon ET on Sept. 13, the source added.

Proceeds will be used to help refinance an existing first-lien senior secured term loan due 2022 priced at Libor plus 275 bps with a 1% Libor floor and first-lien senior secured notes due 2020, and to pay associated fees, expenses and early call premiums.

Other funds for the transaction will come from $500 million to $750 million of first-lien senior secured notes.

ADT is a Boca Raton, Fla.-based provider of monitored security and interactive home and business automation solutions.

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