Fairbanks Morse lifts first- and second-lien term loan sizes

By Sara Rosenberg

New York, Sept. 1 – Fairbanks Morse Defense upsized its fungible incremental first-lien term loan due June 23, 2028 to $215 million from $202.5 million and its fungible privately placed incremental second-lien term loan due June 23, 2029 to $47.5 million from $42.5 million, according to a market source.

Also, the original issue discount on the incremental first-lien term loan finalized at 99.5, the tight end of the 99 to 99.5 talk, the source said.

Pricing on the incremental first-lien term loan is Libor plus 475 basis points with a 0.75% Libor floor.

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

Recommitments were scheduled to be due at 5 p.m. ET on Wednesday.

Allocations are expected on Thursday morning.

Proceeds will be used with additional cash equity to fund an acquisition. The equity contribution is being reduced as a result of the upsizing of the term loans, the source added.

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, and provider of associated parts and maintenance services.

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