The Bank of New York will launch general syndication of a $165 million credit facility for Patriot Media and Communications on Thursday. The credit backs the $245 million acquisition of RCN's New Jersey cable systems business by Steve Simmons and Spectrum Equity Investors. General Electric Capital Corp., National City Bank and SG Bank have already committed $40 million as agents, according to a banker. A couple of investors said the deal could present a challenge. "A leveraged cable buyout is tough. There are other cable names trading at a significant discount in the secondary market," said one buysider.
But the banker dismissed the prediction, noting syndication is already going well with the three $40 million agent commitments ahead of general syndication. Furthermore, he cited the recent performance of Cox Communications as evidence of an upswing for cable and broadband investment. The loan consists of a $40 million, seven-year reducing revolver; a $25 million, seven-year term loan; and a $100 million, eight-year "B" piece. Pricing is LIBOR plus 33/4 % on the pro rata and LIBOR plus 4% on the "B" loan. A banker at BNY declined comment. Calls to Spectrum were referred to general partnerRobert Nicholson, who could not be reached by press time.