Four Seasons Hotels and Resorts, the luxury hotelier, set the rates on $1 billion of loans it’s seeking, according to a person with knowledge of the transaction.
The financing includes a $750 million first-lien term loan that will pay interest at 3.5 percentage points to 3.75 percentage points more than the London interbank offered rate, said the person, who asked not to be identified because the deal is private.
The company also is seeking a $250 million second-lien term loan with a margin of 6 percentage points to 6.25 percentage points, said the person. Both pieces of the bank debt would have a 1 percent floor on Libor.
Citigroup Inc. and Deutsche Bank AG are arranging the financing, according to a second person with knowledge of the deal.
The seven-year first-lien loan may be sold to investors at 99 cents on the dollar and the 7 1/2-year second-lien portion at a discount of 98 cents, the person said.
Lenders will receive 101 soft-call protection during the first six months for the first-lien loan, meaning the company would have to pay a 1 cent premium to reprice the debt in that period, said the person.
Four Seasons will have to pay a 2 cent premium to reprice the second-lien loan during the first year, and a 1 cent premium to do so in the second.
Investors are asked to let the banks know by June 20 whether they will participate in the deal, according to the person.
To contact the reporter on this story: Christine Idzelis in New York at firstname.lastname@example.org
To contact the editor responsible for this story: Chapin Wright at email@example.com