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| Gerald Parsky |
Lehman Brothers, Goldman Sachs and J.P. Morgan launched the financing backing Aurora Capital Group's $1.06 billion acquisition of K&F Industries last Thursday. Aurora is buying the company, a manufacturer of aircraft break products and fuel systems, from Chairman and CEO Bernard Schwartz and Lehman Brothers Merchant Banking. There is around $750-800 million of debt financing that will include a revolver, "A" loan and bonds, said Gerald Parsky, chairman of Aurora. There will also be around $300-350 million of equity financing from Aurora and its investors. K&F currently has some public bonds outstanding that will be redeemed as part of the transaction.
Lehman and J.P. Morgan will co-lead the bank debt, while Lehman and Goldman will co-lead the notes. "We work pretty closely with all these institutions," Parsky noted. "We think very highly of them and we think they can do the job for us." Citigroup will be a co-manager on the deal.