Westinghouse Electric Co. LLC said Apollo Global Management LLC will provide it with an $800 million term loan debtor-in-possession, or DIP, facility, with Citigroup Inc. serving as the sole lead arranger and bookrunner.
The facility is inclusive of a $225 million cash collateralized letter-of-credit facility issued by an affiliate of Citi, court filings show.
According to the company's motion seeking court approval of the DIP, filed March 29 in connection with its Chapter 11 filing, the company's "advantageous position of operating a number of profitable, cash-flow positive business lines, and owning a strong base of largely unencumbered assets" has allowed it "to attract substantial postpetition financing on favorable economic terms from a reputable lender."
Westinghouse added that its DIP marketing process "attracted tremendous interest from the capital markets, including from a significant number of leading banks, private equity firms, and hedge funds" and the company selected Apollo as a lender "following lengthy negotiations with a select group of parties submitting the most competitive bids."
On an interim basis, the company is seeking authority to draw funds under the DIP facility in the aggregate amount of $350 million and to request the issuance of letters of credit in the aggregate available amount of up to $100 million under the DIP LC facility.
The bankruptcy court is slated to consider interim approval of the DIP at the first-day hearing, scheduled for March 30 in Manhattan.
Interest under the DIP is at L+625, with a 1% LIBOR floor, and would be issued with a 2.5% OID. The loan carries an early exit termination of payment of 103% for the first six months, 102% for the next six months and at par thereafter. Among other fees, the facility carries an unused commitment fee of 0.5%.
The facility does not contain any milestone deadlines with respect to asset sales or a reorganization plan.
Among other things, the DIP facility allows the company to use up to $375 million of the proceeds to fund intercompany advances to certain nondebtor foreign affiliates located in France, England & Wales, Belgium, Germany, Japan, Spain and Sweden. (1:17-bk-10778)
This story was adapted from S&P Leveraged Commentary & Data platform, an offering of S&P Global Market Intelligence.