Royal Mail Said to Set Terms for 1.4 Billion-Pound Loan

[TrueBlueTerrier]

U.K.’s Royal Mail Said to Set Terms for 1.4 Billion-Pound Loan

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Royal Mail Group Ltd., the U.K.’s postal service, set the pricing and structure of 1.4 billion pounds ($2.2 billion) of loans to provide funding before a planned sale of the company’s shares, according to three people with knowledge of the matter.

The transaction comprises a five-year 700 million-pound revolving credit facility, and equal-sized three- and five-year million-pound term loans, said the people, who asked not to be identified because the deal is private. Banks are asked to commit 175 million pounds or 75 million pounds to participate in the deal, said the people.

Mish Tullar, a London-based spokesman for Royal Mail, declined to comment on the financing.

The credit line is offered with an initial margin of 85 basis points more than the London interbank offered rate, said the people. The three-year term loan pays interest of 90 basis points more than Libor and the five-year portion 100 basis points. Money in a revolving credit can be borrowed again once repaid.

The state-owned company hired Rothschild last month to advise on the financing.

The government said in April its preferred option is an initial public offering by the end of the financial year. No final decision has been made on how or when to sell, it said.

The U.K. government appointed UBS AG and Goldman Sachs Group Inc. to coordinate the potential sale of the company, with Barclays Plc and Bank of America Corp. assisting as bookrunners, the Department for Business, Innovation and Skills said May 29.

[crammypostie1]

show me the money!

[bag69]

Thought they said we could not get any money unless we were privatised. Another load of lies. Just for a change!!!