Tower Automotive's first-lien was oversubscribed prior to its launch at a bank meeting last Thursday. The $565 million refinancing comprises a $50 million revolver; $375 million first-lien "B" loan; and $140 million second-lien, synthetic letter of credit facility. The revolver and "B" loan are being offered at LIBOR plus 4 1/4% while the second-lien went out at LIBOR plus 7 1/2%. Morgan Stanley and J.P. Morgan are leading the deal.
Proceeds from the new bank loan, along with an offering of $110 million of convertible senior debentures due 2024, will refinance the existing bank facility and be used to call $200 million of 5% convertible notes. Bank of America and J.P. Morgan lead the existing bank facility, which is priced at LIBOR plus 3 1/4%.
"The new facility provides Tower with incremental liquidity, pushes out maturities of their existing debt and provides operational flexibility," a market participant said. A Tower spokeswoman referred calls to a Morgan Stanley banker, who declined comment. A J.P. Morgan spokesman also declined comment.