Revlon Consumer Products Corp.'s $800 million term loan "B" was trading actively last week with about $100 million changing hands since breaking. By the end of the week the name was quoted in the 102 5/8-103 context. "[The loan] has 105 call protection, so trading it at 102-103 is not bad. If they take it out, they would pay it at 105," a trader commented. The 105 call protection is for the first year, stepping down to 103 and then 101 in years two and three. The spread on the six-year loan is LIBOR plus 6%.
"Everybody is trading it, it has been a very well distributed deal," said the buyside trader, describing the activity on the name as a "pretty good two-way flow." Citibank is the lead arranger of the financing. Every major dealer is making a market in the name though, another trader commented.
The loan, which also includes a $160 million revolver, was designed to increase Revlon's near term liquidity position replacing facilities that were likely to be in covenant violation in January 2005 (LMW, 6/28). Proceeds were used to refinance Revlon's existing bank debt and fund a tender offer for the company's $363 million of 12% notes. Maria Sceppaguercio, a Revlon investor relations official, did not return calls.