Lehman Brothers will hold a bank meeting today for TSI Telecommunications Services backing the $800 million GTCR Golder Rauner cash bid at the Intercontinental Hotel in New York. Price talk on the $200 million six-year term loan "B" is LIBOR plus 4% said a banker, familiar with the deal. The $135 million pro rata deck consists of a $35 million revolver and a $100 million five-year term loan "A" with pricing expected in the LIBOR plus 3 1/2% range, depending on the rating agencies. Accompanying the bank debt is $245 million in high-yield notes. Relationship lenders of GTCR have been approached for the pro rata, he noted, but no banks have yet signed on.
An aggressive financing package helped GTCR win the auction, with Lehman willing to provide more cash than other banks to rival private equity firms (LMW, 12/17). Some bankers suggest the deal will be a tough sell as a result, but according to another banker, the aggressive deal must be seen in the light of post September. At the time of pitching for the financing, banks were being more cautious, but recent deals like Collins & Aikman highlight where the market is today, he added. The market has improved substantially since October and November, he explained. Senior and total leverage to EBITDA is in the low two and low fours, he said.