Weather Channel upsizes term loan to $1.07 billion, cuts pricing to Libor plus 400 bps

By Sara Rosenberg

New York, July 16 - Weather Channel increased the size of term loan to $1.07 billion from $1.02 billion and reverse flexed pricing to Libor plus 400 basis points from Libor plus 425 bps, according to a market source.

Pricing on the term loan can step down to Libor plus 375 bps when total leverage is 5¼ times. The deal has always provided for a 25 bps step down, but based on previous pricing terms, the step would have been to Libor plus 400 bps.

As before, the term loan has a 3.25% Libor floor and is being sold to investors at an original issue discount of 97.

Weather Channel's now $1.22 billion credit facility, up from $1.17 billion, still includes a $150 million revolver that is priced at Libor plus 400 bps, the source added.

Deutsche Bank and GE Capital Markets are the co-lead arrangers on the credit facility, with Deutsche the left lead.

Proceeds will be used to help fund the acquisition of the company by NBC Universal, Bain Capital and Blackstone Group from Landmark Communications for about $3.5 billion.

Other financing for the buyout is coming from $610 million of mezzanine debt. The mezzanine was initially going to be sized at $660 million, but it was reduced as a result of the term loan upsizing.

Total leverage is 6.7 times and senior secured leverage is now 4.3 times, up from 4.1 times because of the larger term loan.

Closing is anticipated to take place by year-end, subject to receipt of customary regulatory approvals.

Weather Channel is an Atlanta-based weather company made up of television networks and products for radio, newspapers, digital cable services and interactive television.

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