Foresight launches $750 million term loan at Libor plus 550-575 bps

By Sara Rosenberg

New York, March 1 – Foresight Energy LLC launched at its bank meeting on Wednesday a $750 million five-year term loan with price talk of Libor plus 550 basis points to 575 bps with a 1% Libor floor and an original issue discount of 99, according to a market source.

The term loan has 101 soft call protection for one year and amortization of 1% per annum, the source said.

The company’s senior secured first-lien credit facility also includes a $170 million revolver.

Goldman Sachs Bank USA, Huntington, Deutsche Bank Securities Inc. and Citigroup Global Markets Inc. are the leads on the deal.

Commitments are due at 5 p.m. ET on March 14, the source added.

Proceeds will be used to help refinance about $349 million in second-lien senior secured PIK notes due 2021, about $300 million in second-lien senior secured exchangeable PIK notes due 2017 and existing credit facilities, including the roughly $353 million outstanding under the revolver and the roughly $296 million term loan.

Other funds for the transaction will come from new senior secured second-priority notes due 2024 and about $78 million of cash on hand.

In connection with the refinancing, Murray Energy Corp. intends to contribute to Foresight Energy about $60.6 million in cash in the form of common equity.

Also, Murray Energy is expected to exercise its option to acquire an additional 46% voting interest in Foresight Energy GP LLC, increasing its voting interest to 80%.

Foresight Energy is a St. Louis-based producer and marketer of thermal coal.

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