Feb. 25 (Bloomberg) -- SRS Distribution Inc., a roofing supply distributor, cut the rate it will pay on a $220 million term loan B the company is seeking to back its buyout by Berkshire Partners LLC, according to a person with knowledge of the transaction.
The 6 ½-year debt will pay interest at 3.75 percentage points more than the London interbank offered rate, down from 4.5 percentage points, said the person, who asked not to be identified because the information is private. Libor, a rate banks say they can borrow in dollars from each other, will have a 1 percent floor.
The loan is expected to now be sold at 99.5 cents on the dollar, compared with 99 cents previously proposed, the person said. The decrease in the discount increases proceeds for the company and reduces the yield to investors.
Lenders are being offered six months of soft-call protection of 101 cents, meaning the company would have to pay 1 cent more than face value to refinance the debt during the first six months.
UBS AG and Barclays Plc are arranging the financing and commitments are due by 5 p.m. tomorrow in New York, according to the person.
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