Multi-Billion Deal for DuPont's (DD) Auto Paint Unit All But Locked In (CG)
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DuPont (NYSE: DD) shares are trading higher on the session amid speculation that and effort to unload its auto paint unit might have gotten a little bit more likely.
According to the WSJ on Friday, private equity firm Carlyle Group (Nasdaq: CG) could be one step closer to completing its $4.9 billion bid. Banks have put together a $4.3 billion covenant-lite financing package, pricing the $2.3 billion senior secured debt line at Libor plus 3.5 points. It's one of the largest debt arrangements for a leveraged buyout since the economic downturn a few years back.
The rate is unusually low for an LBO, according to one WSJ source. It was cut twice from the initial pricing of Libor plus 4.25 points.
Carlyle should be able to benefit from the 0.75 point drop, realizing substantial interest expense savings even before any work is done on the investment.
Announced last August, the deal might also be benefiting from timing as debt markets have opened up and investors are hungry for better yields.
Shares of DuPont and Carlyle are both positive Friday morning.
According to the WSJ on Friday, private equity firm Carlyle Group (Nasdaq: CG) could be one step closer to completing its $4.9 billion bid. Banks have put together a $4.3 billion covenant-lite financing package, pricing the $2.3 billion senior secured debt line at Libor plus 3.5 points. It's one of the largest debt arrangements for a leveraged buyout since the economic downturn a few years back.
The rate is unusually low for an LBO, according to one WSJ source. It was cut twice from the initial pricing of Libor plus 4.25 points.
Carlyle should be able to benefit from the 0.75 point drop, realizing substantial interest expense savings even before any work is done on the investment.
Announced last August, the deal might also be benefiting from timing as debt markets have opened up and investors are hungry for better yields.
Shares of DuPont and Carlyle are both positive Friday morning.
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