The add-on piece will be priced the same as Dressers existing $235 million C loan, which carries a spread of LIBOR plus 2 1/2%. In March, Dresser refinanced its $382 million B loan by putting the $235 million C loan in place and carving out a $125 million unsecured term loan (LMW, 3/29). The spokesman said the company had room to do the add-on under the terms of the refinancing, so there was no need to ask for special covenants or amendments. The C loan permitted up to $300 million of acquisitions and $250 million of new secured debt, according to Moodys Investors Service. Morgan Stanley and CSFB are the existing leads on Dressers facility which also includes a $100 million revolver.
Dresser is acquiring the retail fueling systems business of Nuovo Pignone and Dressers Dresser Wayne unit makes and supplies retail petroleum fuel dispensers. The spokesman said the two businesses serve different geographic models and there is very little overlap. Well have an opportunity to rationalize all of our products and only produce a few models globally and create synergies that waytake the best from both companies. First Reserve Corp. and Odyssey Investment Partners are the majority owners of Dresser.