Dade Behring Holdings, a clinical diagnostics company, has tapped its bank group for a 11/2% reduction to the pricing on its term loan, cashing in on improved performance and better market conditions. "We were watching the market closely," said John Duffey, senior v.p. and cfo. Dade had about $433 million in term loans under its "A1" and "A2" tranches when it emerged from its prepackaged bankruptcy last year. The company had since paid down part of that exposure to $360 million. In conjunction with the repricing--which took the interest down from LIBOR plus 41/4% to LIBOR plus 23/4%--Dade also combined the loans into one "B" piece.
Dade also figured a call protection reduction into the timing of its credit tweaking. The term loans carried call protection of 102 until Oct. 3 and 101 for the next 12 months thereafter. The company could have structured the credit changes so that it would not have had to pay the call protection. But Duffey said it "was extremely important to maintain relationships that we had built up with the bank group." Deutsche Bank is the agent bank for the line. The relationship between the bank and the firm dates back to when the company started. Duffey noted that 100% of the bank group stayed in the loan, which speaks to the "great relationships that the company has been able to develop."
In addition to the "B" piece, Dade has a $125 million revolver priced at LIBOR plus 4%. There were no changes to the revolver, which is currently undrawn expect for letters of credit. Dade also has a European "A3" tranche, which was originally E16.5 million and priced at EURIBOR plus 41/4%.