Electrical Components International (ECI), one of the world’s leading suppliers of electrical distribution systems, and a portfolio company of private equity firm Cerberus, is looking to the private debt markets for a $1.1bn loan, according to a report by Bloomberg.
The report cites people familiar with the matter as comforting that ECI has had discussions with prove credit firms over a new loan thtat would be used to refinance the company’s broadly syndicated debt.
ECI is targeting a a $930m term loan, plus a $100m revolver facility and a $100m delayed draw term loan, according to Bloomberg’s sources, with Houlihan Lokey is advising on the transaction.
Conversations are reportedly at an early stage though and the size and structure of the finance p[ackage could yet change.
According to Bloomberg’s sources the deal could price at 6 to 6.5 percentage points above the Secured Overnight Financing Rate, or at 5 percentage points above the benchmark with 100 to 200 basis points of payment-in-kind (PIK), which allows companies to preserve liquidity by paying interest with additional debt.
