T-Mobile USA tightens $4 billion term loan discount to 98.5, frees to trade

By Sara Rosenberg

New York, April 28 – T-Mobile USA Inc. changed the original issue discount on its $4 billion covenant-lite first-lien term loan due April 1, 2027 to 98.5 from 98 and then broke for trading on Tuesday, according to a market source.

Pricing on the term loan remained at Libor plus 300 basis points with a 0% Libor floor, and the debt still has 101 soft call protection through Oct. 1.

Commitments were due at 11:30 a.m. ET on Tuesday, accelerated from 5 p.m. ET on Tuesday, the source added.

Upon breaking, the term loan was quoted at 98¾ bid, 99¼ offered and then levels improved to 99¼ bid, 99¾ offered, another source added.

The company’s $8 billion of credit facilities (Baa3/BBB-/BBB-) also include a $4 billion revolver due 2025 priced at Libor plus 125 bps with a 0% Libor floor and a commitment fee of 37.5 bps, subject to a grid based on first-lien net leverage.

Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Barclays, Goldman Sachs Bank USA, Morgan Stanley Senior Funding Inc., RBC Capital Markets, BNP Paribas Securities Corp., Commerzbank, Credit Agricole, TD Securities (USA) LLC, Wells Fargo Securities LLC, Santander, Societe Generale, SunTrust Robinson Humphrey Inc., NatWest and U.S. Bank are the arrangers on the deal. Deutsche is the administrative agent.

Proceeds were used to help refinance some existing debt at T-Mobile and Sprint Corp. in connection with the completion of the merger of the two companies, and for post-closing working capital needs of the combined company. The companies merged in an all-stock transaction at a fixed exchange ratio of 0.10256 T-Mobile shares for each Sprint share.

As previously reported, the company actually closed on the credit facilities on April 1.

Other funds for the transaction came from a $19 billion five-part offering of senior secured notes.

T-Mobile is a Bellevue, Wash.-based provider of wireless services. Sprint is an Overland Park, Kan.-based communications services company. The combined company is named T-Mobile and has headquarters in Bellevue, Wash.

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