| NEW YORK
NEW YORK Aug 8 Genesee & Wyoming Inc is
expected to tap the market August 13 with a $1.3 billion
pro-rata deal, sources said. The facility is part of a $2.3
billion deal backing its acquisition of RailAmerica Inc.
The pro-rata portion will launch at 2 p.m. at the W Hotel
Lexington Avenue in New York City. Bank of America Merrill Lynch
is leading the $2.3 billion financing package.
The pro-rata facility comprises a $425 million senior
secured revolver and an $875 million, five-year term loan A due
2017. A $1 billion, seven-year term loan B due 2019 rounds out
The spread on the pro rata tranche is 250bp over Libor
subject to a leverage based pricing grid. Pricing on the TLB is
The facility will back the acquisition of RailAmerica and
refinance existing debt at Genesee. Expected corporate ratings
are Ba3/BB- and senior secured Ba3/BB-.
The TLA will amortize at 5 percent in year one and two, 10
percent in year three and 15 percent in year four and five. The
TLB will amortize at 1 percent per annum. The TLA will be
redeemable at any time at par, while the TLB will include a 101
soft call in year one.
Covenants include a maximum net total leverage ratio and a
minimum interest coverage ratio.
Genesee & Wyoming Inc said on July 23 it had struck a deal
to buy rival RailAmerica Inc for $27.5 a share in cash or $1.39
billion to create the biggest short-line railroad operator in
the United States.