Rural/Metro outlines details of $155 million credit facility ahead of Friday launch

By Sara Rosenberg

New York, Feb. 9 - Rural/Metro Corp. revealed details of its $155 million senior secured credit facility on Wednesday as the company gears up to for its bank meeting on Friday to launch the deal into syndication, according to a market source. Citigroup and JPMorgan are the lead banks on the deal, with Citigroup the left lead.

The facility consists of a $120 million term loan B due 2011, a $15 million institutional letter-of-credit facility due 2011 and a $20 million revolver due 2010. All tranches are talked at Libor plus 350 basis points, the source said.

Proceeds from the facility will be used to help finance the company's tender offer and consent solicitation for its $150 million 7 7/8% senior notes due 2008 and to repay about $153 million of outstanding revolver debt.

The borrower under the facility will be a newly formed wholly owned subsidiary of Rural/Metro. This subsidiary will also offer $140 million of senior subordinated notes due 2015 to finance the tender offer. And, Rural/Metro will offer about $50 million in gross proceeds of senior discount notes due 2016.

Previously it was known that the company would be launching a new credit facility this week via left lead Citigroup to help fund the tender offer but no other details on the transaction were available until now.

The tender offer, which expires March 3, and consent solicitation, which expires Feb. 16, commenced on Feb. 3.

Rural/Metro is a Scottsdale, Ariz., provider of emergency and non-emergency medical transportation, fire protection and other safety services.

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