Rural/Metro firms spread on $270 million term at Libor plus 425 bps

By Sara Rosenberg

New York, Nov. 16 - Rural/Metro Corp. finalized pricing on its $270 million term loan at Libor plus 425 basis points with a 1.75% Libor floor and an original issue discount of 991/2, according to a market source.

Initial talk on the loan had been Libor plus 425 bps to 450 bps with a 1.75% Libor floor and an original issue discount of 99 to 991/2.

Also, the company's revolver is now expected to come at a size of $85 million, although that hasn't firmed yet. Official talk is a revolver in the range of $75 million to $100 million.

As was previously reported, pricing on the revolver is Libor plus 450 bps with a 75 bps unused fee, and it is offered with a 100 bps upfront fee.

RBC Capital Markets is the lead bank on the secured credit facility (B1/B+) that has an expected size of $355 million.

Proceeds will be used to refinance the company's existing senior secured revolver, term loan and letter-of-credit facilities, to fund a tender offer for its senior discount notes, to pay off cash-collateralized letters of credit, and for working capital and general corporate purposes.

Total and senior leverage is 3.75 times, or 3.25 times net.

Rural/Metro is a Scottsdale, Ariz.-based provider of medical ambulance response services.

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