DynCorp to repay some debt with IPO proceeds

By Ted A. Knutson

Washington, Sept. 28 - DynCorp International Inc. said it plans to use an unspecified portion of a just-announced $450 million initial public offering of class A common stock to repay debt.

In addition to the debt repayment, DynCorp said it will use IPO proceeds to pay a $100 million special dividend to class B common shareholders.

The company currently has a $345 million six-year term loan facility and a $75 million five-year revolving credit facility led by Goldman Sachs Credit Partners LP and Bear, Stearns & Co. The interest rates on the loans vary from Libor plus 200 basis points to 250 bps.

DynCorp also has $320 million 9.5% senior subordinated notes due 2013 outstanding.

Credit Suisse First Boston and Goldman, Sachs & Co. are joint bookrunners for the IPO, and Bear Stearns & Co. is joint lead manager. Co-managers are CIBC World Markets, Jeffries Quarterdeck, UBS Investment Bank and Wachovia Securities.

The Irving, Texas-based technical services company made the announcement in an S-1 filing with the Securities and Exchange Commission. The company provides law enforcement training and support, security services, base operations, logistics support and aviation services and operations.

DynCorp said it will apply to list its class A common stock on The New York Stock Exchange under the symbol "DCP."

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