By Jonathan Schwarzberg and Leela Parker Deo
NEW YORK, July 21 (Reuters) - Antares Capital is lining up a
$13.9 billion financing package that backs General Electric
Capital Corp's sale of the middle market sponsor finance
platform to Canada Pension Plan Investment Board (CPPIB) and
raises funds for future growth, sources said.
The package for the acquisition, which was announced on June
9, consists of a $1.2 billion term loan A and a $2 billion
revolver as well as a $10.7 billion asset-based facility, the
sources said.
Credit Suisse is leading the credit facilities. Syndication
of the deal launches at a bank meeting on July 27. Lender
commitments are due August 12.
Both the term loan A and the revolver will mature in five
years. Pricing will be tied to a ratings-based grid. The term
loan A will amortize at a rate of 5 percent during the first
year, 7.5 percent the second year, 10 percent the third year and
12.5 percent in each of the last two years.
The credit facility will be governed by total net asset
value and adjusted asset ratio tests.
CPPIB's $12 billion acquisition of Chicago-based Antares
vaults Canada's largest pension fund into the top tier of U.S.
middle market lenders and marks GE Capital's exit as the
dominant player in that space. Antares provides financing to
small and mid-sized private equity-backed companies.
Antares will operate as a standalone, independent business
with its own capital base and will be governed by its own board
of directors. The business will also retain the Antares brand
and will remain under the helm of managing partners David
Brackett and John Martin.
CPPIB is contributing $3.85 billion in cash toward the $12
billion purchase price, Thomson Reuters LPC reported on June 11.
The remainder would be financed with debt provided by a group of
global investment banks, Mark Jenkins, CPPIB's senior managing
director and global head of private investments, told LPC in
June.
General Electric Co announced plans to divest the majority
of finance arm GE Capital's assets in April, including the
Antares sponsor finance business and its U.S. commercial lending
and leasing unit.
(Editing By Lynn Adler and Jon Methven)