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Windstream up to $3.3 billion credit facility to launch Wednesday
By Sara Rosenberg
New York, June 5 - Windstream Communications is scheduled to hold a bank meeting on Wednesday to launch its proposed up to $3.3 billion credit facility (Ba2/NA/BBB-), according to a market source.
JPMorgan and Merrill Lynch are joint lead arrangers and bookrunners on the credit facility, with JPMorgan the left lead.
The facility consists of a $500 million five-year revolver talked at Libor plus 150 basis points, $500 million five-year term loan A talked at Libor plus 150 bps, a $1.9 billion seven-year term loan B talked at Libor plus 175 bps and a $400 million five-year delayed-draw term loan C that will be available for four months, the source said.
Proceeds will be used to help fund the merger of Alltel Corp. wireline business with Valor Communications Group Inc. in a transaction valued at about $9.1 billion, with the merged company renamed Windstream Communications and based in Central Arkansas.
More specifically, the term loan A and term loan B will be used to help finance a $2.4 billion dividend payment to Alltel, to refinance Valor's existing credit and to refinance about $81 million of Alltel's outstanding bonds.
Proceeds from the revolver will be used for working capital and general corporate purposes.
And, proceeds from the delayed-draw term loan C will be used to purchase up to $400 million of Valor's outstanding bonds that may be tendered as part of this merger transaction. It is anticipated that these bonds will not be put in connection with the transaction, which would then cancel out the need for the term loan C tranche, reducing the overall credit facility size.
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