Cyxtera Technologies trims pricing on first-, second-lien term loans

By Sara Rosenberg

New York, March 13 – Cyxtera Technologies Inc. (Colorado Buyer Inc.) reduced pricing on its $815 million seven-year covenant-light first-lien term loan (Ba3/B+) to Libor plus 300 basis points from talk of Libor plus 350 bps to 375 bps and on its $310 million eight-year covenant-light second-lien term loan (B3/CCC+) to Libor plus 725 bps from talk of Libor plus 750 bps to 775 bps, according to a market source.

The first-lien term loan still has a 1% Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months, and the second-lien term loan still has a 1% Libor floor, a discount of 99 and hard call protection of 102 in year one and 101 in year two but is callable at 101 in the first year in the event the U.S. tax code eliminates tax deductibility of interest for federal income tax.

There is a ticking fee of 50% of the drawn spread from days 46 to 60 and the full spread plus the greater of Libor and the floor thereafter.

Amortization on the first-lien term loan is 1% per annum.

The company’s $1,275,000,000 credit facility also includes a $150 million five-year revolver (Ba3/B+).

Commitments continue to be due at 5 p.m. ET on Tuesday, the source added.

Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Barclays, Credit Suisse Securities (USA) LLC, Jefferies Finance LLC, HSBC Securities (USA) Inc., Macquarie Capital (USA) Inc. and Citizens are the bookrunners on the deal, with Citi the left lead on the first-lien debt and JPMorgan the left lead on the second-lien debt.

Proceeds will be used to help fund the acquisition of 57 data centers from CenturyLink Inc. by a joint venture being formed by BC Partners and Medina Capital, along with Longview Asset Management, and the combination of the data centers with Medina Capital’s security and data analytics portfolio.

The CenturyLink data centers are being purchased for $2.15 billion in cash, subject to offsets for capital lease obligations and various working capital and other adjustments.

Also, CenturyLink will receive a minority stake to be valued at $150 million in the consortium’s newly formed global secure infrastructure company.

Closing on the data centers acquisition is expected early in the second quarter, subject to regulatory approvals and other customary conditions.

© 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.