Firth Rixson Said to Seek Interest Rate Cut on $705 Million LoanPatricia Kuo
Firth Rixson Ltd., the U.K. engineering company owned by Oak Hill Capital Partners LP, wants to lower the cost of $705 million of loans raised in November, according to two people with knowledge of the deal.
The company is proposing to reduce the interest margin on its $420 million deal due 2017 to 300 basis points from 425 basis points, said the people, who asked not to be identified because the transaction is private. A basis point is 0.01 percentage point.
It wants to pay a margin of 375 to 400 basis points more than the London interbank offered rate on its 180 million-pound ($285 million) facility rather than the current rate of 475 basis points, the people said. The minimum on the benchmarks will remain at 1.25 percent.
Deutsche Bank AG is leading banks arranging the repricing with replies from lenders due by Feb. 7, the people said.
The Sheffield, U.K.-based company refinanced its debt last year in a deal that decreased the rate it paid on its debt. Oak Hill acquired the company for approximately 945 million pounds in 2007, according to data compiled by Bloomberg.
James David, a spokesman for New York-based Oak Hill, didn’t respond to a phone call and e-mail sent outside of business hours.