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ITC^DeltaCom sets Tuesday launch for $315 million credit facility
By Sara Rosenberg
New York, June 21 - ITC^DeltaCom, Inc. has scheduled a bank meeting for Tuesday to launch its proposed $315 million credit facility, according to a syndicate document.
The credit facility consists of a $10 million five-year revolver that is expected to be undrawn at close and is talked at Libor plus 350 basis points, with a 50 bps commitment fee, a $230 million six-year first-lien term loan talked at Libor plus 350 bps and a $75 million seven-year second-lien term loan talked at Libor plus 750 bps, the document said.
Credit Suisse is the lead bank on the revolver and first-lien term loan, and Tennenbaum Capital Partners is the lead on the second-lien term loan.
Credit Suisse has also committed to purchase $29 million of common stock and Tennenbaum has agreed to exchange $25 million of third-lien debt and all preferred shares and warrants it holds for common stock.
In addition, in connection with these transactions, Welsh, Carson, Anderson & Stowe, the company's majority shareholder and a current lender, has agreed to purchase $21 million of common stock and to exchange $23.5 million of third-lien debt and all preferred shares and warrants held by them for common stock.
And, the company intends to exchange common stock for its other closely held outstanding series of preferred shares.
The net effect of the transactions will be to completely refinance the company's outstanding debt and eliminate three series of preferred stock and related warrants, leaving it with $305 million of first- and second-lien funded debt, about 81 million shares of common stock outstanding on a fully diluted basis and cash on hand of about $50 million.
The completion of each of these financing transactions is conditioned on each other.
Closing is currently expected to take place early in the third quarter.
ITC^DeltaCom is a Huntsville, Ala., provider of integrated communications services.
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