Wyle reworks term loan grid for spread range of Libor plus 450-575 bps

By Sara Rosenberg

New York, Aug. 30 - Wyle Inc. revised its term loan grid so that pricing can range from Libor plus 450 basis points to 575 bps as opposed to from Libor plus 400 bps to 575 bps, according to a market source.

Specifically, if the corporate rating is B2/B, pricing is Libor plus 450 bps if senior leverage is less than 2.85 times and Libor plus 500 bps if senior leverage is more than 2.85 times. If the corporate rating is lower than B2/B, pricing is Libor plus 525 bps at less than 2.85 times senior leverage and Libor plus 575 bps at more than 2.85 times senior leverage, the source said.

The change to the grid did not result in any change to initial pricing on Wyle's $195 million term loan add-on (B1/BB) or its existing term loan.

Pricing on the add-on and the existing loan is Libor plus 575 bps with a 2% Libor floor. The add-on, which could allocate on Tuesday, is being sold at an original issue discount of 981/2.

Barclays Capital and JPMorgan are the lead banks on the deal.

Proceeds from the term loan add-on, cash on hand and $35 million of equity from the company's controlling shareholder, Court Square Capital Partners, will be used to fund the acquisition of CAS Inc. from ITT Corp.

Closing of the acquisition is subject to review and approval by regulatory authorities, such as the Federal Trade Commission, and other customary conditions.

Following the transaction, pro forma total leverage will be roughly 5.5 times, and the combined entity will have pro forma 2009 revenues of about $1 billion.

Wyle is an El Segundo, Calif.-based provider of high-tech systems engineering, testing and information technology services. CAS is a Huntsville, Ala.-based provider of systems engineering and technical assistance for military applications.

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