Terms emerge on financing for Blackstone's TR unit buy

By Andrew Berlin

NEW YORK (LPC) - Details of the US$13.5bn loan and bond financing backing US private equity firm Blackstone Group's acquisition of a majority stake in Thomson Reuters' Financial and Risk (F&R) unit are emerging, banking sources said on Thursday.

The deal is being led by JP Morgan, Bank of America Merrill Lynch and Citigroup. More than 20 banks were invited to join at the next level to underwrite 28 percent of the deal, the sources said.

Blackstone is seeking credit approval by Friday, they said, adding that there could be six to seven tiers of commitments. Blackstone declined to comment.

The deal consists of a US$8bn-equivalent term loan B (TLB), which is split between US$5.5bn and $2.5bn-equivalent in euros.

The financing also includes US$3bn-equivalent of secured bonds split between US$2bn and $1bn-equivalent in euros, and US$2.5bn-equivalent of unsecured bonds split between US$1.8bn and US$700m-equivalent in euros, the sources said.

The company will also place a US$750m revolving credit facility.

The final splits could be subject to change, depending on investors' demand for the deal, sources said.

Additional funding comes from US$1bn in preferred equity, US$3bn of cash equity that Blackstone is contributing, and US$2.5bn of existing equity, based on the US$20bn valuation, that will be rolled over.

Leverage is expected to be around 4.5x through the secured debt and 5.6x total, after Ebitda adjustments.

(Editing by Tessa Walsh)