Revlon Consumer Products Corp.’s $800 million term loan “B” was trading actively in the 102 1/2- 102 7/8 context, with about $100 million changing hands since breaking, said a trader. “[The loan] has 105 call protection, so trading it at 102-103 is not bad. If they take it out, they would pay it at 105,” he added. The 105 call protection is for the first year, stepping down to 103 and then 101 in years two and three. The spread on the six-year loan is LIBOR plus 6%. “Everybody is trading it, it has been a very well distributed deal,” said the buyside trader, describing the activity on the name as a “pretty good two-way flow.” Citibank is the lead arranger of the financing. The loan, which also includes a $160 million revolver, was designed to increase Revlon’s near term liquidity position replacing facilities that were likely to be in covenant violation in January 2005 (LMW, 6/28). Proceeds were used to refinance Revlon’s existing bank debt and fund a tender offer for the company’s $363 million of 12% notes. Maria Sceppaguercio, a Revlon investor relations official, did not return calls.
Revlon Trade Revolves Around Call Protection Play