Hilton ups term B-2 to $7.6 billion, flexes to Libor plus 300 bps

By Sara Rosenberg

New York, Sept. 23 - Hilton Worldwide Holdings Inc. increased the size of its seven-year covenant-light term loan B-2 to $7.6 billion from $5 billion and eliminated plans for an $850 million five-year covenant-light term loan B, according to a market source.

In addition, pricing on the term loan B-2 is Libor plus 300 basis points, down from talk of Libor plus 325 bps to 350 bps, and the discount is 991/2, revised from 99, the source said.

The term loan B-2 still has a 1% Libor floor and 101 soft call protection for six months.

The eliminated term loan B had been talked at Libor plus 300 bps with a 1% Libor floor, an original issue discount of 99½ and 101 soft call protection for six months.

The company's now $8.6 billion credit facility, up from $6.85 billion, also includes a $1 billion revolver.

Deutsche Bank Securities Inc., Bank of America Merrill Lynch, J.P. Morgan Securities LLC, Morgan Stanley Senior Funding Inc. and Goldman Sachs Bank USA are the lead banks on the deal.

Proceeds from the credit facility and $1.5 billion of notes will be used to refinance existing debt.

The notes were downsized from $3.25 billion with the term loan B-2 upsizing.

The new debt is expected to be completed before the company closes on its recently announced initial public offering of common stock.

Hilton Worldwide is a McLean, Va.-based hospitality company.

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