Bloomberg News

DJO Finance Said to Increase Term Financing to $350 Million

March 13, 2012

DJO Finance LLC, the Blackstone Group LP-owned maker of orthopedic devices, increased the size of a term loan it’s seeking to refinance debt to $350 million from $300 million, according to a person with knowledge of the transaction.

The debt due in September 2017 will pay interest at 5 percentage points more than the London interbank offered rate, with a 1.25 percent minimum on the benchmark, according to data compiled by Bloomberg. The debt is expected to be sold to investors at 98.5 cents on the dollar, the person said.

The additional $50 million in proceeds will be used to pay down part of an $843 million term loan, according to the person.

The company is also seeking to extend that term loan to November 2016 from May 2014, the person said. Approximately 65 percent of the company’s existing lenders have agreed to push out the maturity date, according to the person. The extended debt will pay interest at 5 percentage points more than Libor, the data show.

Half the proceeds of the increased portion of the new loan will go to repay the unextended term loan, half to the extended debt, the person said.

Lenders were offered a 25 basis-point fee to agree to the extension and a 25 basis-point amendment fee, the data show. A basis point is 0.01 percentage point.

Credit Suisse Group AG arranged the financing for the Vista, California-based company, which is also seeking a five- year $100 million revolving line of credit to replace its existing revolver that is due in November 2013.

ReAble Therapeutics Inc., an orthopedic device maker owned by Blackstone, purchased DJO for $1.3 billion in 2007.

Peter Rose, a Blackstone spokesman, 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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