Time updates pricing on $700 million covenant light term loan, sets Thursday morning deadline

By Paul A. Harris

Portland, Ore., April 16 - Time Inc. updated pricing on its downsized $700 million seven-year covenant-light term loan B on Wednesday, according to a market source.

The drawn margin increased to Libor plus 325 basis points, up from Libor plus 275 bps to 300 bps.

The original issue discount is increased to 99 from 99.5.

The Libor floor is unchanged at 1%.

The 101 soft call protection is increased to 12 months from 6 months.

Books close at 10 a.m. ET on Thursday.

Earlier, the deal was downsized from $900 million as its senior notes offering was lifted to $700 million from $500 million.

Along with the B loan, the company's now $1.2 billion credit facility (Ba1/BBB-), down from $1.4 billion, includes a $500 million five-year revolver that has a consolidated secured net leverage covenant of 2.75 times tested quarterly.

Citigroup Global Markets Inc., Barclays, BNP Paribas Securities Corp., Bank of America Merrill Lynch, J.P. Morgan Securities LLC, Morgan Stanley Senior Funding Inc. and Wells Fargo Securities LLC are the joint bookrunners on the deal. RBS Securities Inc. is a senior co-manager, and Macquarie Capital is a co-manager.

Allocations are expected on Wednesday or Thursday, and closing is anticipated to occur in the week of April 21.

Proceeds from the credit facility and notes will be used to fund the acquisition of Time Inc.'s U.K. publishing business, which is owned by a wholly owned subsidiary of Time Warner Inc., and to pay a special cash dividend to Time Warner Inc.

Time is a New York-based media company.

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