Deutsche Bank and Credit Suisse First Boston's $1.25 billion refinancing for PanAmSat is off to a solid start with the $600 million, seven year "B" term loan half full at press time. Last week Standard & Poor's assigned a BB rating to the senior secured credit facility and a B rating to the proposed $500 million senior unsecured note offering. A banker set out the spreads, with the "B" carrying LIBOR plus 3 1/4 %; the $400 million, six-year term loan "A" priced at LIBOR plus 2 3/4 %; and the six-year, $250 million revolver at LIBOR plus 2 3/4 %. There is a 3/4 % commitment fee on the revolver. Amortization of the term loans does not begin until 2004. There is a financial covenant for an initial five times debt to EBITDA ratio. Hughes Electronics owns 81% of PanAmSat, and this refinancing is connected to the plethora of transactions tied to the proposed merger of EchoStar with Hughes Electronic (LMW, 12/24).
Satellite Deal Nabs Commitments