Weekly Trade Round-Up
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Weekly Trade Round-Up

Freescale Semiconductor's $3.5 billion term loan broke at 100 3/8-5/8 in the secondary market on Tuesday. General Motors Corp.'s term loan "B" broke in the secondary market at 100 3/8-5/8 on Monday. Visteon Corp.'s $200 million add-on term loan broke at par on Tuesday.

Freescale Debuts In Secondary

Freescale Semiconductor's $3.5 billion term loan broke at 100 3/8-5/8 in the secondary market on Tuesday. The loan dipped as low as 100 1/8-3/8 before holding steady at 100 1/4-1/2. One trader said the loan bounced back and forth because investors were wrestling with the right level for a loan that has a LIBOR plus 2% coupon.


The $3.5 billion term loan is part of Freescale's $4.25 billion credit facility, which backs the $17.6 billion leveraged buyout of the company by a group of investors including The Blackstone Group, The Carlyle Group, Permira Funds and Texas Pacific Group (CIN, 11/3). Citigroup, Credit Suisse, JPMorgan, Lehman Brothers and UBS lead the deal, which also includes a $750 million asset-based revolver. A spokeswoman did not return calls.


GM's First Term Loan Breaks

General Motors Corp.'s term loan "B" broke in the secondary market at 100 3/8-5/8 on Monday. It dipped slightly to 100 1/4-1/2 with certain dealers trading a couple of hundred million dollars of paper. JPMorgan and Citigroup lead the deal, which is priced at LIBOR plus 2 3/8%. Pricing at launch was LIBOR plus 2 3/4%, according to a GM spokeswoman. 


Dealers said trading was very active in the loan, which is popular with investors. "It is a great deal," said one buyside trader. "It has great collateral coverage. There is so much debt that is junior to the bank debt. Even if it went into bankruptcy, this would trade well." The term loan is secured by a first priority security interest in all of GM's U.S. machinery and equipment.


Visteon Add-On Breaks At Par

Visteon Corp.'s $200 million add-on term loan broke at par on Tuesday. The loan is an addition to its $800 million term loan, which broke into the secondary market in June (CIN, 6/19). JPMorgan and Citigroup lead the credit line, which is priced at LIBOR plus 3%. In November, Moody's Investors Service downgraded Visteon's corporate family rating to B3 from B2 and lowered the ratings on Visteon's secured bank obligations to Ba3 from Ba2, reflecting expected weaker financial performance in 2006 and difficult market conditions in 2007. A Visteon spokesman did not return calls.


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