Market players are eagerly awaiting this week's launch of the Credit Suisse First Boston- and Morgan Stanley Dean Witter-led $820 million credit backing the leveraged buyout of energy equipment provider Dresser Equipment, sponsored by Odyssey Partners and First Reserve Corp. "This will definitely blow out," said one banker who has seen the deal, pointing to the $455 million term "B" as a tranche institutional buyers will be jumping on. Bankers said the scarcity of well-structured, strong credits bodes well for Dresser. "It's expected to rate BB- and it's an industrial. This thing is right in the zone," said another banker. Market sources said Dresser will quickly avert attention away from telecom credits as the market has become more bullish on the energy sector.
The Dresser credit comprises a $100 million, six-year revolver priced at LIBOR plus 3%; a $265 million, six-year term loan "A" priced at LIBOR plus 3%, and a $455 million, eight-year term loan "B" priced at LIBOR plus 31/2 %. The agents are offering a commitment fee of 50 basis points.