Travelport $1.5 Billion Loan Breaks

Travelport's $1.5 billion term loan broke in the secondary market at 100 1/4-100 3/4 last week. The financing is part of a $2.2 billion term facility that includes a E620 million term loan portion. UBS, Credit Suisse and Lehman Brothers lead the deal, which backs Blackstone Group's $4.3 billion acquisition of the online travel business from Cendant Corp.

The U.S. tranche is priced at LIBOR plus 2 3/4% and the European tranche at Euribor plus 2 3/4%. Standard & Poor's assigned a B+ to the financing citing the company's high leverage and the seasonal and cyclical nature of the travel industry.

The $4.3 billion used to fund Blackstone's acquisition will result in weak credit ratios, said the ratings agency. Expected EBITDA interest coverage will be around two times with debt to EBITDA in the low six times. The company's financial flexibility will be more limited than those of its publicly held competitors, said the agency in a release. Officials at Travelport did not return calls by press time.