Regal Cinemas launches $1.25 billion term loan at Libor plus 350 bps

By Sara Rosenberg

New York, May 5 - Regal Cinemas Corp. launched its $1.25 billion 61/2-year term loan on Thursday with price talk of Libor plus 350 basis points with a step-up to Libor plus 375 bps when leverage is over 3.0 times, according to a market source.

Price talk on the new term loan is the same as pricing on the existing term loan that is being refinanced.

Existing lenders are being offered a 100 bps fee to roll over their commitments.

The $1.335 billion amended and restated senior credit facility (Ba3/BB-) also includes an $85 million five-year revolver.

Credit Suisse, Barclays, Bank of America and Deutsche Bank are the lead banks on the deal, with Credit Suisse the left lead.

Financial covenants include a maximum adjusted consolidated leverage ratio, a maximum consolidated leverage ratio and a minimum interest coverage ratio.

There is a $200 million accordion feature.

In addition to refinancing bank debt, the new facility, along with $250 million of 8.625% senior notes, will be used to repurchase all of the company's outstanding 9.375% senior subordinated notes due 2012 and for general corporate purposes, which may include the repayment or repurchase of other debt.

Commitments towards the credit facility are due on May 13.

The notes offering and the credit facility are expected to close on May 17.

Regal Cinemas is a subsidiary of Regal Entertainment Group, a Knoxville, Tenn.-based motion picture exhibitor.

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