Bank of America and Merrill Lynch are preparing an approximately $220 million five-year amortizing term loan for Teterboro, N.J.-based Quest Diagnostics. The term loan will take out a portion of a $550 million bridge loan for the diagnostic testing company that backs the acquisition of Unilab, a provider of diagnostic testing services in California. The $1.1 billion acquisition announced last week includes approximately $200 million of Unilab debt, explained Joseph Manory, senior v.p. and treasurer. The bank meeting will be in the very near future, he said. Pricing will be the same as the current line, at LIBOR plus 1%, with a 31 basis point commitment fee.
Merrill Lynch was the adviser on the transaction and B of A is on the left of the loan, said a banker. The rest of the bridge loan will be taken out with a bond offering, Manory commented. The bridge loan will not be tapped until June he said, once the acquisition is completed.