Current market conditions and Gray Television's improved credit profile allowed the television station and newspaper company to cut the interest rate on its "B" loan by 50 basis points. The $375 million "B" loan now carries a spread of LIBOR plus 1 3/4%.
Lead arranger Wachovia Securities brought the idea of the spread decrease to Gray, said James Ryan, Gray's senior v.p. and cfo. "Wachovia, who led the transaction, indicated to us that the market would be receptive to that type of transaction right now," he stated. The credit profile of the company has significantly improved over the past couple of years, he added. Ryan said there was a favorable response from a significant amount of existing participants. Bank of America is syndication agent on the credit and Deutsche Bank serves as documentation agent.
The debt was originally put in place in October 2002 to back an acquisition and refinance debt (LMW, 11/10/02). Gray then returned to the market last June to cut pricing on the institutional piece (6/2/03). The facility also includes a $75 million revolver that was not amended. In addition to the latest reprice, the final "B" loan maturity was extended six months to June 2011 from December 2010.