(Bloomberg) – Media division of Verizon Communications Inc. uses the US leveraged loan market to finance the buyout of Apollo Global Management Inc.
According to a person familiar with the matter, the two new loans, which last for six years, are $ 750 million apiece. One piece is a so-called “high yield B term,” which is not revocable for two years and has no amortization, said the man, who asked not to be named because the deal is private.
Verizon Media, which includes brands such as Yahoo and AOL, borrows at a time when there are other LBO-backed loans on the market. FirstGroup Plc’s two U.S. bus divisions are raising about $ 2 billion to finance the acquisition of the divisions by private equity firm EQT AB, while EmployBridge LLC, also acquired by Apollo, is also offering a B loan.
The leveraged loan market has been a favored haven for borrowers for most of this year as investors seek protection from rate hikes. According to Refinitiv Lipper, the floating rate asset class has been raising cash for 24 consecutive weeks, while most companies have noticed a price change in their favor during the syndication process.
The Royal Bank of Canada is spearheading the deal to sell the loan to Verizon Media, and a call from lenders is scheduled for July 8 to discuss the deal. Also part of the deal are a $ 150 million revolving credit line and $ 500 million privately placed Holdco bonds.
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