The Ackerley Group, a Seattle-based media and entertainment company, has switched lenders from First Union to Credit Suisse First Boston, due to over-restrictive covenants on the existing facility. Kevin Hylton, senior v.p. and cfo, said "it was difficult for Ackerley to meet the covenants of the loan arranged in 1999, specifically leverage ratios, and the move to a more asset-based facility from an operational revolver, will be more suitable."
Launching this week, the loan consists of a $20 million three-year revolver and a $100 million five-year term loan "B," priced at 3 3/4 % over LIBOR and 4% over LIBOR respectively. The revolver carries a jumbo 1 1/2 % commitment fee and the deal is expected to close within 30-45 days. Ackerley is rated B+/B1.
"At this point it is not anticipated for First Union to be involved in the new credit," Hylton noted. Ackerley has worked with CSFB in the past and so they are not new to the company, he added. The previous loan totaled $275 million, but was paid down after the divestitures. Pricing was linked to leverage and averaged 8.74%.