Temple, Ariz.-based Mobile Mini, a provider of portable storage units and offices, has switched its lead lender from Deutsche Bank to Fleet Capital after Fleet offered better pricing on the $250 million revolver. The lead spot was put out to bid and Fleet provided the best deal, said Larry Trachtenberg, executive v.p. and cfo. Deutsche Bank remains the investment bank of choice for Mobile though, he added, as the firm has done equity offerings for Mobile.
The new line replaces a $160 million revolver and a $10 million term loan, which needed to be upsized, noted Trachtenberg. "We are a capital-intensive business growing at a rate of 30% a year," he said. The five-year term and $80 million increase in the amount will enable Mobile to expand either through enlarging lease fleets or entering new markets. Both the new and old lines are asset-based, enabling much higher leverage off the strength of the assets, he explained.
Current market conditions have led to a slight increase in the spread, which based off a matrix pricing is LIBOR plus 2%, according to Trachtenberg. BANK ONE and J.P. Morgan are co-syndication agents and Bank of America and Washington Mutual Bank are co-documentation agents. Deutsche Bank is no longer in the bank group, he noted. Commenting on the overall lending environment, he said, "In general banks are a lot less competitive than a few years ago, but things are a lot easier than they were two months ago."