J.P. Morgan and Citibank last week launched syndication of a $430 million refinancing package for camera-maker Panavision with $180 million of bank debt and $250 million of supposedly silent, second-lien bonds. The silent lien refers to bondholders not having a voice if the bank debt holders decide to move the collateral in case of foreclosure. A J.P. Morgan spokesman denied the bonds contain the silent component, but he said the bondholders do have a second lien on the collateral package. The new deal refinances $340 million in bank debt and so significantly reduces the total amount of bank debt from 4 times to 2 times, noted a banker. The incorporation of the second lien is similar to the Revlon deal recently led by J.P. Morgan, bankers said. Scott Seybold, cfo and executive v.p. of Panavision, could not be contacted, according to company officials.
Split between a $150 million, six-year term loan "B" and a five-year, $30 million revolver, pricing is LIBOR plus 4% and LIBOR plus 31/ 2% respectively. The bank debt is contingent on the successful sale of the bonds, noted the banker. Pricing on the bonds could not be ascertained. Officials at Citi did not return calls.