Bookrunners are out with a pricing flex across all holdco tranches of the €7.9bn debt package backing the merger of
The aggressive new pricing reflects the strong interest in the deal, with all tranches oversubscribed. The decision to retain the large mezzanine facility, albeit more tightly priced, surprised many in the market including some mezzanine investors who had shied away from the deal expecting to be cast aside in a structural flex.
While it looks as though bookrunners could have gone for an even more aggressive structure the record size and complexity of the deal – which includes undrawn facilities linked to as yet to be decided acquisition costs – may have discouraged arrangers from discommoding senior bank lenders in particular who supported the deal, by cutting the layers of junior debt .
Holdco debt now consists of a €300m eight-year revolver at 200bp over Euribor, a €938m eight-year term loan B loan paying 237.5bp reduced from 250bp and a €938 nine-year term loan C loan paying 262.5bp down from 287.5bp.
In addition, pricing on the €500m second-lien loan has been cut from 425bp to 375bp, while a €606.3m 10-year mezzanine facility will pay 7%, made up of 3.5% cash and 3.5% PIK, down from 8%.
Call protection has been cut to 101, par on both second lien and mezzanine. Opco facilities will remain unchanged. These are made up of €4.6bn of senior secured credit facilities, which will refinance debt at P7S1 and finance the potential acquisition of SBS Broadcasting by P7S1.
Responses are due by June 25. Bookrunners are
The opco debt is made up of an up to €600m seven-year revolver paying 175bp, an up to €2bn seven-year B loan paying a 175bp and an up to €2bn eight-year C loan paying a 187.5bp.