After flexing pricing upwards, Lehman Brothers has filled the book on the $130 million "B" term loan for The Aerostructures Corp. The institutional tranche initially was priced at LIBOR plus 33/ 4%, but it was finally sold at 99 with a coupon of LIBOR plus 4%. Calls to Lehman bankers were not returned by press time.
Aerostructures, which is owned by The Carlyle Group, is a designer and manufacturer of aerospace structures including wings, fuselage sections and precision-machined components. One investor who passed on the deal said the pricing is not great considering the sector. In addition, the company's contracts are with Airbus Industries, which is cutting costs, he noted.
Moody's Investors Service assigned a B1 rating to the credit, addressing sector problems. But given the number of ship-sets under contract for delivery to original equipment manufacturers next year, the rating agency believes that 2003 revenue from commercial aircraft production should hold steady at approximately the same level as this year (LMW, 10/21). Another positive for the credit, which also consists of a $35 million revolver, is diversification through the military sector.