Syndication of the $1.1 billion "B" loan for Nalco Co. progressed strongly last week, with bankers quoting a book of over $2 billion. As of press time, pricing on the loan had not formally been revised, but a banker said if pricing does change, it will likely be when the bonds are priced. There was speculation that the LIBOR plus 23/4% pricing would not hold, despite loan sources noting that the pricing already looked aggressive for a deal over $1 billion in size. This belief was further strengthened when Moody's Investors Service assigned a B1 rating to the credit, a week after Standard & Poor's bolstered syndication with a BB rating (see story, page 8).
Citigroup, Bank of America, J.P. Morgan, Deutsche Bank,Goldman Sachs and UBS are the lead arrangers on the $3.2 billion bank and bond debt financing. The debt package backs the $4.2 billion purchase of Nalco, a water treatment provider and chemical processor currently owned by French water company Suez, by The Blackstone Group, Apollo Management and Goldman Sachs Capital Partners. Officials at the banks either declined comment or did not return calls. There is also a $300 million "A" loan and a $250 million revolver. The pro rata is priced at LIBOR plus 21/2%.