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RLPC-Newsday readies $650 mln loan - sources

Wed Jun 18, 2008 11:59am EDT

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NEW YORK, June 18 (Reuters) - Bank of America, Merrill Lynch and Citigroup will launch the sale of a $650 million loan on Thursday to back the acquisition of Newsday Media Group by Cablevision Systems Corp, sources told Reuters Loan Pricing Corp on Wednesday.

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The borrower for the transaction will be Newsday LLC. The senior secured fixed-rated loan will have a term of five years and will be non-callable for 2.5 years.

The loan will be guaranteed by Cablevision's (CVC.N) CSC Holdings and all subsidiaries of Newsday LLC.

Roughly $630 million of borrowings will be used to distribute a cash payment to Newsday's current owner, Tribune Co. Tribune will receive $612 million in cash, another $18 million in prepaid rent under leases for certain facilities used in the business, and an equity stake in the partnership valued at $20 million.

Newsday Media includes Newsday, which reaches 1.5 million Long Island adults each week; amNewYork, a free daily in New York City; the Star Community Publishing Group of weekly shoppers; and Island Publications' portfolio of lifestyle magazines.

Under the terms of the deal, Newsday could be marketed to Long Island households served by Cablevision that do not currently subscribe to the paper. (Reporting by Faris Khan; editing by Dena Aubin)

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