Buyside accounts piled into the financing backing First Reserve Corp.'s $1.25 billion acquisition of Dresser Rand Co. from Ingersoll Rand Co. One portfolio manager said $1.5 billion was in the book for the bank loan only days after launching last week. The $295 million seven-year "B" loan saw pricing flexed down 50 basis points to LIBOR plus 2%. The senior debt is rated B1.
Citigroup, Morgan Stanley and UBS are leading the financing, which also comprises a $100 million euro tranche and a five-year, $300 million revolver. One buysider commented on the sponsors' substantial $435 million equity investment and the cushion provided by a $420 million bond offering (LMW, 10/11). Bankers familiar with the deal declined comment.
Dresser Rand is split into two types of business. The service maintenance side and manufacturing compressor equipment segment. Thomas Dennison, managing director of First Reserve, said the business is strong as they have the world's largest installed base that makes it less tied to the commodity business (8/27).