U.S. TelePacific launches $460 million credit facility to investors

By Sara Rosenberg

New York, Feb. 10 - U.S. TelePacific held a conference call on Thursday to launch a $460 million credit facility, according to a market source.

Credit Suisse, Deutsche Bank and Bank of America Merrill Lynch are the lead banks on the deal.

The facility consists of a $25 million five-year revolver and a $435 million six-year term loan, the source said.

Price talk on the term loan is Libor plus 500 basis points with a 1.25% Libor floor and an original issue discount of 991/2, the source added.

The term loan includes 101 soft call protection for one year.

Proceeds will be used to refinance existing debt.

Early in 2010, the company got a $370 million 51/2-year first-lien term loan and a $25 million revolver.

Pricing on the existing term loan is Libor plus 725 bps with a 2% Libor floor, and it was sold at an original issue discount of 98. This tranche includes 101 soft call protection for one year, but since that is about to expire, lenders will be getting paid down at par when this new deal is done.

U.S. TelePacific is a Los Angeles-based competitive local exchange carrier.

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