September 13, 2012 / 1:10 PM / in 5 years

RLPC: First Data sets drive-by $400M loan

NEW YORK, Sept 13 (Reuters) - First Data Corp has set a $400 million first-lien term loan to repay a portion of the existing $1.8 billion unextended term loan due 2014, sources told Thomson Reuters LPC.

The new term loan will be priced at LIB+500, the same as the spread on its recently extended loan due 2017. It will mature in September 2018. An original issue discount has not yet been set.

Credit Suisse, Deutsche Bank, Citi, HSBC and Bank of America Merrill Lynch lead the loan. Commitments are due later today.

First Data is tapping into continued investor demand for leveraged loans. The average secondary price for the most liquid leveraged loans recently hit a five-year high of 98.4 cents on the dollar, according to LSTA/Thomson Reuters LPC Mark-to-Market Pricing.

The institutional forward calendar jumped to more than $21 billion this week, as companies tap the market to refinance at lower spreads.

In August, the issuer extended $282 million of its existing loans from a 2014 maturity to 2017. Extending lenders received a spread increase to LIB+500 from LIB+275. Lenders that opted not to extend received a pay down from a recently completed $1.3 billion senior secured note sale.

Credit Suisse led that amend and extend.

In March, First Data extended the maturity of a portion of its euro and dollar term loans to March 2017 from September 2011 at an increased spread of LIB+500.

The year before, the issuer extended $5 billion of its term loans to 2018 from 2014 at LIB+400. At the time, the company also extended $1.2 billion of its revolver.

As part of its 2007 LBO by KKR, First Data obtained a $15 billion financing package consisting of a $2 billion revolver due Sept 2013, a $5 billion TLB-1, a $5 billion TLB-2 and a $3 billion TLB-3. The term loans had original maturities of 2014.

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