Deutsche Bank, Goldman Sachs and Lehman Brothers went out to managing agents last week on the financing backing Penn National Gaming's $2.2 billion acquisition of Argosy Gaming Co. Ten lenders were offered $100 million commitments, market participants noted. Calyon, Wells Fargo Bank and Bank of Scotland have already signed on at the agent level, taking $300 million tickets.
Syndication of the credit is not expected to launch until the second quarter of 2005 because of regulatory hurdles. The deal is expected to comprise a five-year, $750 million revolver; a six-year, $400 million "A" loan; and a seven-year, $1.75 billion "B" loan. The spread is contingent upon ratings, but is being talked at LIBOR plus 2 3/8% on the pro rata and LIBOR plus 2 1/2% on the "B" loan. Officials from the lead banks either declined comment or did not return calls. A Penn National spokesman did not return calls.