Affiliated Computer Services' $800 million term loan broke at 100 3/4 and traded up to 101. A dealer estimated around $150 million of paper traded on the break. Citigroup leads the deal, which is priced at LIBOR plus 1 1/2%. The credit line also consists of a $1 billion revolving credit facility. The dealer said the revolver did not trade because it is owned by relationship banks that chose to hold the facility.
The proceeds from the term loan will be used to finance a tender offer of 6% of the company's common shares. ACS will also use the loan to refinance $288 million of outstanding debt under its existing revolving credit facility. Proceeds from the revolving credit facility will be used for working capital purposes and for acquisitions.
The new credit agreement includes an uncommitted accordion feature for up to $750 million, which it will use for incremental borrowings under either the revolver or term loan. The term loan includes an additional $3 billion accordion feature, which it will use to fund purchases of the company's equity and debt securities.
Moody's Investors Service assigned a Ba2 rating to the senior secured credit facility and a Ba2 corporate family rating. Kevin Kyser, senior v.p. of finance, did not return calls.