Keystone Automotive Seeks Dividend Loan; Atlas Cuts Debt Cost

Keystone Automotive Operations Inc. is asking lenders for $335 million of loans to help fund a shareholder dividend, while Atlas Energy LP (ATLS) cut debt costs amid record demand for junk loans.

Keystone, owned by Platinum Equity LLC, is seeking a $235 million first-lien term loan due in six years and a $100 million second-lien portion maturing in seven years, according to a person with knowledge of the deal. UBS AG, Goldman Sachs Group Inc. and Bank of America Corp. are arranging the financing, which will also help the auto-parts maker refinance debt, said the person, who asked not to be identified because the transaction is private.

Companies are tapping the bank debt market as investors added a record $1.8 billion this week to U.S. loan funds, according to Bank of America.

Atlas lowered the cost of a $240 million acquisition loan it’s seeking to 5.5 percentage points more than the London interbank offered rate after originally proposing 6 percentage points to 6.5 percentage points more than the lending benchmark, said another person with knowledge of the matter. Libor will have a 1 percent floor.

The Pittsburgh-based company said June 10 that its exploration and production unit was buying natural gas reserves in New Mexico and Alabama from EP Energy LLC for $733 million, as well as reserves in Oklahoma for $67 million.

Deutsche Bank AG and Wells Fargo & Co. are arranging the financing for the purchases.

Loan prices rose for a ninth straight day to 98.33 cents on the dollar today, according to the Standard & Poor’s/LSTA U.S. Leveraged Loan 100 index.

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

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

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.