Pilot Travel Centers has completed a $250 million credit, downsized from a proposed $355 million deal, in order to back its $190 million acquisition of Williams TravelCenters. The company originally planned a $105 million, one-year bridge loan as part of the deal, but no longer needed it because of the delay in the acquisition's closing date into this year, said Jeffrey Cornish, v.p. of finance and cfo. The postponement allowed Pilot Travel more time to complete an $85 million add-on private placement deal with J.P. Morgan, he explained, so the bridge was no longer required (LMW, 1/13). Wachovia Securities leads the new facility.
The three-year, unsecured revolver also refinances Pilot Travel's previous $210 million revolver, which was led by J.P. Morgan. Cornish explained that Pilot Travel switched to Wachovia after it delivered an attractive proposal for the deal. He added that Wachovia had been one of the top banks involved in Pilot Travel's previous credits. Cornish said that 12 banks are involved in the final bank group with three new relationships for the Knoxville, Tenn.-based company. Pilot Travel has added Merrill Lynch, La Salle Bank, which is owned by ABN AMRO, and BB&T to its bank group, he stated. He said that the company has done some non-loan product business, such as swaps, with its banks in the past. "It's great to have them in there," he said of the new lenders.
The new loan is priced on a grid that Cornish expects to settle at LIBOR plus 11/ 2% once normal operating levels are in place. The previous deal had similar pricing levels, he added. Cornish noted that the company does not see any more big acquisition plans for the immediate future. "We've got to digest [this] acquisition," he said. Pilot Travel operates the largest travel center network in the U.S., featuring food chains and fuel islands.