Bloomberg News

EMI Music Publishing Increases Term Loan to $1.15 Billion

February 24, 2012

EMI Music Publishing increased the size of a term loan it’s seeking to support its acquisition by Sony Corp (6758) to $1.15 billion from $1.05 billion, according to a person with knowledge of the transaction.

The debt, due in six years, pays interest at 4.25 percentage points more than the London interbank offered rate with a 1.25 minimum on the benchmark, according to data compiled by Bloomberg.

EMI is proposing to sell the debt at 99 cents on the dollar, the data shows. The discount lowers proceeds for the company and boosts the yield to investors.

Lenders will receive 101 soft-call protection, the person said, meaning that EMI would have to pay one cent more than face value to reprice the debt in its first year.

The financing also includes a $75 million, five-year revolving line of credit that will pay 4.75 percentage points more than Libor, the person said. The credit line is subject to 75 basis points on undrawn portions. A basis point is 0.01 percentage point.

UBS AG is arranging the financing and lenders must submit commitments by 5 p.m. today in New York, said the person, who declined to be identified because the terms are private.

An investor group led by Sony Corp. agreed to buy EMI from Citigroup Inc. (C) for $2.2 billion.

Dylan Jones, a spokesman for EMI, declined to comment.

In a revolving credit facility, money can be borrowed again once it’s repaid; in a term loan, it can’t

To contact the reporter on this story: Michael Amato in New York at mamato3@bloomberg.net

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net


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