Fairbanks Morse firms discounts on first- and second-lien term loans, frees to trade

By Sara Rosenberg

New York, Dec. 20 – Fairbanks Morse Defense (Arcline FM Holding LLC) finalized the original issue discount on its incremental term loans at the tight end of guidance and then the debt made its way into the secondary market on Monday, according to a market source.

The issue price on the company’s fungible $240 million incremental first-lien term loan due June 23, 2028 was set at 99.5, the tight end of the 99 to 99.5 talk, and the discount on its fungible $40 million incremental second-lien term loan due June 23, 2029 firmed at 99, the tight end of the 98.5 to 99, the source said.

Pricing on the incremental first-lien term loan is Libor plus 475 basis points with a 0.75% Libor floor, and pricing on the incremental second-lien term loan is Libor plus 825 bps with a 0.75% Libor floor.

During the session, the bank debt broke for trading, with the incremental first-lien term loan quoted at 99½ bid, par offered, and the incremental second-lien term loan quoted at 99¼ bid, par ¼ offered, another source added.

Jefferies LLC, BMO Capital Markets and UBS Investment Bank are the lead arrangers on the deal.

Proceeds will be used to fund an acquisition and pay down the outstanding balance on an ABL facility.

Fairbanks Morse Defense is a Beloit, Wis.-based provider of propulsion systems, ancillary power, motors and controllers for the U.S. Navy and U.S. Coast Guard.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.