DAE Aviation launches $937 million credit facility

By Sara Rosenberg

New York, July 10 - DAE Aviation Holdings Inc. held a bank meeting on Tuesday morning to launch its proposed $937 million secured credit facility (BB-), according to a market source.

Barclays Capital is the lead bank on the deal.

The facility consists of a $100 million revolver talked at Libor plus 250 basis points, a $557 million term loan B talked at Libor plus 275 bps and a $280 million asset-sale loan talked at Libor plus 300 bps, the source said.

Financial covenants include debt to EBITDA and capital expenditures.

Proceeds from the credit facility, along with proceeds from a $325 million unsecured high-yield bond offering, will be used to help fund Dubai Aerospace Enterprises Ltd.'s acquisition of Standard Aero Holdings Inc. and Piedmont Hawthorne Holdings Inc. from the Carlyle Group.

Dubai is putting in a 40% equity check towards the transaction.

Total leverage is 7.4 times, dropping down to 6.8 times following the asset sale, and senior secured leverage is 5.5 times, dropping down to 4.1 times following the asset sale.

The asset-sale loan is expected to be repaid within 12 months.

DAE Aviation is a provider of maintenance, repair and overhaul of engines for business and regional jets, and a provider of component and airframe repairs, large business jet completions and modifications, MRO services for certain military engines and engineering services.

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