CCGI downsizes by $100 million, lifts spread to Libor plus 1,000 bps

By Sara Rosenberg

New York, Oct. 13 - CCGI Holding reduced its credit facility to $175 million from $275 million and increased pricing on the entire deal to Libor plus 1,000 basis points with a 2% Libor floor from talk of Libor plus 750 bps to 775 bps with a 1.75% Libor floor, according to a market source.

The original issue discount on the facility was left unchanged at 98, the source said.

The downsizing was done to the six-year term loan, which is now $150 million instead of $250 million, while the size of the $25 million five-year revolver was left unchanged.

Call protection was added to the term loan of 103 in year one, and 101 in years two and three, the source remarked.

The deal is fully circled at the revised terms, the source added.

Jefferies and UBS are the lead banks on the deal.

Prior to the changes, the deal was rated B3/B-.

CCGI was formed through the recent merger of Covad Communications Group, MegaPath and Speakeasy.

The companies' existing debt was left outstanding in connection with the merger, so now this new deal is for refinancing that existing debt.

CCGI is a San Jose, Calif.-based provider of IT broadband and telecommunications services to small- and medium-sized businesses.

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