Freescale

Freescale Seeks $1 Billion Loan (Summary) 

February 10, 2009

            Freescale Semiconductor Holdings, the computer chip maker taken private in 2006 by Blackstone Group LP for $17.6 billion, is seeking a loan of as much as $1 billion from its existing lenders. The new loans would mature on Dec. 15, 2014, and be guaranteed by the same guarantors of its senior secured credit facility. If the lenders don’t agree to put up the money, bondholders will then be given a chance to swap their securities for stakes in the loan.

            According to Bloomberg, among the bondholders, first priority to swap into the loan is being given to investors that own the company’s $1.5 billion of so-called pay-in-kind toggle notes maturing in 2014. Pay-in- kind notes give the issuer the option to pay interest with additional debt.

Second priority in the exchange is being given to about $1.5 billion of 10.125 percent senior subordinated notes due in 2016, and Freescale will accept as much as $746 million of those securities. The subordinated notes will be exchanged at a rate of 33.5 cents on the dollar for the loan by the early commitment date.

Freescale reported a fourth quarter operating loss of $4.2 billion.

  Web Articles:

• Freescale Seeks $1 Billion Loan From Its Creditors (Update2)
• Freescale seeks $1 Billion loan from existing lenders