Bloomberg News

Dell Said to Meet With Lenders Tomorrow to Discuss Buyout Loans

September 10, 2013

Dell Inc. (DELL:US) is meeting with lenders tomorrow to discuss $5.5 billion in loans to back its buyout by Silver Lake Management LLC and Chief Executive Officer Michael Dell, according to a person with knowledge of the transaction.

The financing consists of a $4 billion term B portion and a $1.5 billion C slice, said the person, who asked not to be identified because of lack of authorization to speak publicly. The personal computer maker may start selling junk bonds as early next week to fund the purchase.

The loans are part of $13.8 billion financing commitment Dell obtained in February to back the $24.9 billion deal, the biggest leveraged buyout since Energy Future Holdings Corp. was purchased by KKR & Co. and Texas Pacific Group in 2007. Billionaire financier Carl Icahn gave up battling for control of Dell yesterday, ending months of opposition that impeded the buyout from being completed.

Bank of America Corp., Barclays Plc, Credit Suisse Group AG, and Royal Bank of Canada are arranging the financing, which also includes a $2 billion asset-backed piece and $3.25 billion of bridge debt, Bloomberg data show.

Bridge facilities are short-term loans that usually mature in one year and are often used as backstops to bond offerings or longer-dated bank debt.

Dell and partner Silver Lake sweetened their proposal last month by offering a special dividend of 13 cents a share on top of an already increased bid of $13.75 a share.

The lender meeting was earlier reported by Reuters.

To contact the reporter on this story: Christine Idzelis in New York at cidzelis@bloomberg.net

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


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