Avis launches $900 million term loan B at Libor plus 275 bps

By Sara Rosenberg

New York, Feb. 21 - Avis Budget Car Rental LLC held a call at 2:45 p.m. ET on Thursday to launch a $900 million term loan B due March 2019 that is talked at Libor plus 275 basis points with a 1% Libor floor and a par offer price, according to a market source.

The B loan has 101 soft call protection for one year, the source said.

J.P. Morgan Securities LLC and Citigroup Global Markets Inc. are the lead banks on the deal.

Proceeds will be used to refinance an existing term loan C due March 2019 and to partially fund the acquisition of Zipcar Inc. for $12.25 per share in cash, representing a total transaction value of about $500 million.

Avis expects to generate $50 to $70 million in annual synergies as a result of the acquisition.

Closing on the acquisition is expected in the spring, subject to approval by Zipcar shareholders and other customary conditions.

Avis is a Parsippany, N.J.-based provider of vehicle rental services. Zipcar is a Cambridge, Mass.-based car sharing network. Following the acquisition, Zipcar will move its headquarters to Boston.

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