Wednesday, 19 October 2011 at 14:44, Bloomberg
G4S will pay an interest margin of 160 basis points on €700m of three-year loans for its takeover of ISS Holdings. (REUTERS)
G4S Plc, the world’s largest security provider outlined terms of $6 billion in acquisition loans to fund its takeover of ISS Holdings.
The €2.6 billion ($3.6bn) one-year term loan will pay initial interest of 125 basis points over the euro interbank offered rate, according to a regulatory filing from the Crawley, England-based company. The margin will rise to 150 basis points in July 2012, and to 225 basis points one year later if the debt is extended.
G4S will pay an initial interest margin of 160 basis points on €700 million of three-year loans, with the rate falling to as low as 85 basis points if its debt falls to 1.5 times earnings before interest, tax, depreciation and amortisation, or less, according to the filing.
Starting interest for the £230 million ($362 million) credit line maturing in 2013 and the €800m revolving credit due in March 2016 is 150 basis points more than the London interbank offered rate. The margin will fall to 55 basis points when leverage shrinks to 1.5 times or less, G4S said in the filing.
G4S will pay a 15 basis-point fee if it uses more than a third of the credit lines and a 30 basis-point fee to use more than two-thirds. A basis point is 0.01 percentage point.
The UK security firm agreed to buy Copenhagen-based cleaning service provider ISS from funds advised by EQT Partners and Goldman Sachs Capital Partners for a total value of £5.2 billion on October 17.
Deutsche Bank AG, Royal Bank of Scotland Plc and HSBC Holdings Plc are underwriting the new loans.
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