Sept. 19 (Bloomberg) -- Dell Inc., the computer maker that Chief Executive Officer Michael Dell and Silver Lake Management LLC are buying for $24.9 billion, added a 500 million euro ($677.6 million) portion to the financing, according to a person with knowledge of the transaction.
The debt, which will pay interest at 4 percentage points more than the Euro interbank offered rate with a 1 percent minimum on the lending benchmark, will be used to reduce bonds that the company is seeking to finance the buyout, said the person, who asked not to be identified because the terms aren’t set.
The loans are part of a $13.8 billion financing commitment Dell obtained in February to back the deal, which is the biggest leveraged buyout since Energy Future Holdings Corp. was purchased by KKR & Co. and Texas Pacific Group in 2007. Billionaire financier Carl Icahn gave up battling for control of Round Rock, Texas-based Dell on Sept. 9, ending months of opposition that impeded the buyout from being completed.
The debt includes a $4 billion, 6 1/2-year term loan that will pay interest at 3.75 percentage points more than the London interbank offered rate, with a 1 percent minimum on the lending benchmark, according to data compiled by Bloomberg.
Dell is proposing to pay interest at 2.75 percentage point to 3 percentage points more than Libor, with a 1 percent floor on a $1.5 billion term piece that matures in five years, the data show.
Bank of America Corp., Barclays Plc, Royal Bank of Canada and UBS AG are arranging the financing for which commitments from lenders are due on Sept. 23, the person said.
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