NDS Buyout Loan Poised To Reopen Levered Primary Market

LONDON (Reuters) – Lenders behind a $1.33 billion loan backing the buyout of digital pay-TV specialist NDS Group have launched the loan for sell-down in a move which could re-open the European primary leveraged market, bankers said on Friday.

The $1.33 billion loan finances Permira’s acquisition of a 51 percent stake in NDS Group from News Corp. in August last year.

Sell-down of the loan was put on hold as lending conditions froze in the aftermath of Lehman’s collapse, and the terms of the facility have been revised since it was underwritten.

The loan, which includes $990 million of senior debt and a $340 million mezzanine tranche, has been arranged by bookrunners and mandated lead arrangers Bank of Ireland, BNP Paribas, JP Morgan, Lloyds TSB and Morgan Stanley.

The $990 million senior debt is split into a $350 million term loan A with a seven year maturity which pays a margin of 400 basis points (bps) over LIBOR, a $490 million bullet term loan B with an eight year maturity with a 450 bps margin, and a $150 million, seven-year revolving credit facility which pays 350 bps, one banker said.

The deal also includes a $340 million mezzanine tranche with a nine-year tenor, which has been arranged by JP Morgan and Morgan Stanley.

Net leverage on the loan has reduced to 3.2 times senior debt and 4.6 times total debt, the banker said.

A bank meeting is scheduled to take place in London on Wednesday June 3.

UK-based NDS supplies the encryption technology and smartcards that clients including News Corp’s BSkyB uses to ensure their programs can only be watched by paying subscribers.

(Reporting by Zaida Espana; Editing by David Holmes)