Rice Drilling sets spread on second-lien loan at Libor plus 725 bps

By Sara Rosenberg

New York, April 8 - Rice Drilling B LLC firmed pricing on its $300 million 51/2-year senior secured second-lien term loan at Libor plus 725 basis points, the tight end of the Libor plus 725 bps to 750 bps talk, according to a market source.

Also, the original issue discount on the loan was set at 981/2, the midpoint of the 98 to 99 guidance, the source said.

As before, the loan has a 1.25% Libor floor and hard call protection of 102 in year one and 101 in year two.

Covenants include a total net secured debt ratio.

Recommitments are due at noon ET on Tuesday, the source continued.

Barclays is the lead arranger on the deal.

Proceeds will be used to repay existing debt, to redeem convertibles and for general corporate purposes, including capital expenditures and acquisitions.

Leverage is 4 times net debt to first quarter 2013 annualized EBITDA.

Rice Drilling is a Canonsburg, Pa.-based natural gas exploration and production company.

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