Socitété Générale is launching an amendment this week for Banner Seventeen, owner of the Boston Celtics, and last week launched a deal for Houston NFL Holdings, the 70% owner of the Houston Texans National Football League franchise.
The Texans are refinancing the "A" and "B" loans into one "A" loan to cut interest costs. The new five-year, $219.75 million "A" loan kicked off last Thursday at LIBOR plus 1 1/8%. "The term 'B' was basically set up at a higher price and is primarily institutional," a banker said. "It's more structured like a term 'A' catered to banks because of the pricing." The loan is being offered to both new and existing lenders. "Our feeling is that the 'A' market, the bank market, is strong right now and there is so much demand for quality paper," said Scott Schwinger, the Texans' cfo. "Given that we are a funded investment grade paper, there is strong demand for that."
The old facility, which closed in January, comprised a $125 million "A" loan at LIBOR plus 1 3/4% and $100 million "B" loan at LIBOR plus 2%. "We've got a great deal as it stands right now, but if we can improve the pricing that's what we'd like to do," Schwinger noted. The refinancing is being done at $219.75 million because the company has already made some amortization payments, the banker noted. J.P. Morgan is co-lead arranger. Officials at SG and J.P. Morgan declined comment.
The Celtics amendment will extend the maturity date on the $100 million facility 18 months to June 30, 2009. The facility will be priced at LIBOR plus 1 1/8%. The amendment is only being offered to existing lenders.