Investors poured into Cincinnati Bell's new $525 million term loan "D," which refinances existing alphabet tranches. A banker said the proposed LIBOR plus 23/4% spread may be cut by 25 basis points. A Cincinnati Bell spokesman explained that the company is taking the opportunity to replace higher-cost debt. A $540 million offering of senior subordinated notes at 83/4% will retire outstanding 9% convertible notes due 2009.
Cincinnati Bell needed to amend the existing bank lines to permit the refinancing, the spokesman said. "The trigger was the convertibles, but we are taking the opportunity while we are amending it to take out the ["A," "B," and "C" tranches]," he said. The existing $135 million "B" loan, and $60 million "C" loan are both priced at LIBOR plus 33/4%. Bank of America, Credit Suisse First Boston and Goldman Sachs lead the credit. Bankers either could not be reached or declined comment on the progress of the refinancing.