Frac Tech International sets price talk for $1.7 billion term loans

By Paul A. Harris

Portland, Ore., April 25 - Frac Tech International LLC set pricing for its $1.7 billion of term loans (B2/B+) on Monday, according to a market source.

A $1.5 billion five-year term loan B is talked at 475 basis points over Libor and a 1.5% Libor floor, discounted to 99.

A $200 million delayed-draw loan is also talked at Libor plus 475 bps with a 1.5% Libor floor. The discount talk is 99.75. However the discount increases to 99.00 if the loan is funded at closing. There is also a 250 bps unused fee on the delayed-draw loan.

Both tranches feature 101 soft calls.

Commitments are due on Friday.

Bank of America Merrill Lynch and Citigroup Global Markets Inc. are the lead banks.

Proceeds will be used to help fund the acquisition of a controlling stake in Frac Tech Services LLC by an investor group including Temasek Holdings Ltd. and RRJ Capital from the Wilks family and to fund a dividend payment to Chesapeake Energy Corp., which owns 30% of Frac Tech.

Cisco, Texas-based Frac Tech is an oilfield service company.

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