Nalco (NLC) Executes Long-term Refinancing Deal
Nalco Holding Company (NYSE: NLC) announced that its wholly owned subsidiary, Nalco Company, successfully completed a $1.25 billion refinancing that replaces the majority of a term loan due in November of 2010 and, along with cash on hand, will be used to retire $475 million of its senior notes otherwise due in November of 2011. The refinancing includes $750 million in new term loans due in 2016 and $500 million of new senior notes due in 2017. The arrangements also include a new five-year, $250 million revolving credit facility supplied by a consortium of 7 banks, replacing the revolving credit facility that would otherwise have expired in November of 2009.
Pricing on the new term loans was set at a rate of LIBOR plus 350 basis points, with a LIBOR minimum of 300 basis points, and sold at $97.50 per $100 of principal amount for a yield of just under 7%. The $500 million of senior unsecured notes issued in the high yield market carry a coupon of 8 1/4% and were priced to yield 8 5/8%.
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