Level 3 has gotten commitments from its lenders to increase its borrowing power under its secured credit facility through a new $2 billion Tranche B 2022 Term Loan, part of which will finance the cash portion of its acquisition of tw telecom.
In connection with the closing of that acquisition, parts of the loan will be used to refinance certain existing indebtedness of tw telecom, including fees and premiums.
The service provider's Level 3 Financing Inc. subsidiary will amend and restate its existing senior secured credit facility to include the new Tranche B 2022 Term Loan, which will mature on Jan. 31, 2022.
Level 3 Financing said that interest on the Tranche B 2022 Term Loan will be equal to LIBOR plus 3.5 percent with LIBOR set at a minimum of 1.0 percent. The Tranche B 2022 Term Loan was priced at 99.25 percent of par.
After meeting customary closing conditions, Level 3 Financing expects the closing of the Tranche B 2022 Term Loan will take place with the closing of the pending acquisition of tw telecom.
Sunit Patel, executive vice president and CFO of Level 3, said that in addition to securing the new loan it "has received all necessary approvals from the various U.S. state public utility commissions for the completion of the tw telecom transaction and related borrowings."
Merrill Lynch, Pierce, Fenner & Smith Incorporated, Citigroup Global Markets Inc., Morgan Stanley Senior Funding Inc., Barclays Bank PLC, Goldman Sachs Bank USA, Jefferies Finance LLC and JP Morgan Securities LLC are acting as Joint Lead Arrangers and Joint Bookrunning Managers for the Tranche B 2022 Term Loan.
- see the release
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