Ciena launches $200 million term loan B at Libor plus 375-400 bps

By Sara Rosenberg

New York, April 12 – Ciena Corp. launched on Tuesday its $200 million five-year covenant-light term loan B (Ba2) with price talk of Libor plus 375 basis points to 400 bps with a 0.75% 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, the source said.

Amortization on the term loan is 1% per annum.

There is an incremental allowance of the greater of $100 million and an unlimited amount subject to 2.5 times senior secured net leverage, subject to 50 bps MFN for life.

Mandatory prepayments are from 50% of excess cash flow with a step-down to 0% at 2.5 times senior secured net leverage, and 100% of net proceeds from asset sales of non-ABL collateral and debt issuances, subject to certain exceptions.

Bank of America Merrill Lynch and Deutsche Bank Securities Inc. are the joint lead arrangers on the deal.

Commitments are due at noon ET on April 19, the source added.

Proceeds will be used to add cash to the balance sheet and, in the future, to help repay convertible notes due in 2017.

Pro forma secured and net leverage will be 1.4 times and 4.3 times, respectively.

Closing is expected on April 25.

Ciena is a Hanover, Md.-based supplier of communications networking equipment and software.

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