Fortescue ups term loan to $5 billion, flexes to Libor plus 425 bps

By Sara Rosenberg

New York, Oct. 11 - Fortescue Metals Group increased the size of its five-year covenant-light senior secured term loan (Ba1/BB+/BBB-) to $5 billion from $4.5 billion and reduced pricing to Libor plus 425 basis points from Libor plus 475 bps, according to a market source.

Also, the Libor floor was lowered to 1% from 1.25%, the source said.

The original issue discount of 99 and soft call protection at 101 for one year were left unchanged.

Recommitments were due at noon ET on Thursday, the source added.

Credit Suisse and J.P. Morgan Securities LLC are the lead banks on the deal.

Proceeds will be used to refinance all of the company's existing bank debt and to provide additional liquidity.

The facility extends the earliest repayment date for any of the company's debt to November 2015 and removes financial maintenance covenants that applied under previous facilities.

Fortescue is an East Perth, Australia-based iron ore producer.

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