BASIS POINT-Terms set for Australia's Tatts A$1 bln loan

MELBOURNE, May 1 (Reuters Basis Point) - Terms have been
set for a A$1 billion ($943 million) loan for Australian gaming
company Tatts Group Ltds (TTS.AX: Quote, Profile, Research, Stock Buzz), sources said on Thursday.

The deal, arranged by Commonwealth Bank of Australia
(CBA.AX: Quote, Profile, Research, Stock Buzz), nabCapital (NAB.AX: Quote, Profile, Research, Stock Buzz), Royal Bank of Scotland (RBS.L: Quote, Profile, Research, Stock Buzz)
and Westpac Banking Corp (WBC.AX: Quote, Profile, Research, Stock Buzz), divides into a A$200 million
one-year tranche A, a A$620 million three-year tranche B and a
A$180 million five-year tranche C.

Opening margins, calculated on a leverage matrix, are 75
basis points (bp), 90bp and 105bp over BBSY for tranches A, B
and C, respectively, based on a company net debt-to-EBITDA
leverage of 1.5 to two times.

There are four levels of participation: Senior lead
managers would receive a 30bp fee for A$150 million
commitments; lead managers would get 25bp for A$100 million;
managers would get 20bp for A$75 million and co-managers 15bp
for A$50 million.

Responses are due in late May. Australia and New Zealand
Banking group (ANZ.AX: Quote, Profile, Research, Stock Buzz) has joined as an early bird participant.
The facility, which has not been underwritten by the four
leads, is being sold down on a best-efforts basis.

Tatts and competitor Tabcorp (TAH.AX: Quote, Profile, Research, Stock Buzz) earlier this month
lost their duopoly to supply gaming machines in Victoria state
from 2012 onwards.

Tatts does not have a public rating, but has a debt profile
equivalent to a BBB+ rated corporate.

The terms are as follows:

Tatts Group Ltd

Facility type: (A) Working capital facility (B,C) Term
loan

Amount: A$1bn: (A)A$200m (B)A$620m (C)A$180m

Maturity: (A)1 year (B)3 years (C)5 years

Repayment: Bullet

Margin over: Debt-to-EBITDA>3 times: (A)117.5bp over

BBSY; (B)137.5bp over BBSY (C)157.5bp
over

BBSY;

2.5-3 times: (A)100bp (B)117.5bp (C)135bp

2-2.5 times: (A)85bp (B)100bp (C)120bp

1.5-2 times: (A)75bp (B)90bp (C)105bp

<1.5 times: (A)67.5bp, (B)82.5bp, (C)97.5bp

Repayment: (A,B,C) Bullet

Senior lead

management fee: 30bp for A$150m

Lead management

fee: 25bp for A$100m

Management fee: 20bp for A$75m

Co-management fee:15bp for A$50m

MLAs: Commonwealth Bank of Australia,
nabCapital,

Royal Bank of Scotland, Westpac Banking
Corp

Status: In process, responses due end May
($1=A$1.06)
(Reporting by Sharon Klyne)