Finland’s Nokia has reportedly priced the €1.2bn bridge loan package it is using to support its takeover of telecoms equipment venture Nokia Siemens Networks.
The loan comprises three tranches that were priced significantly higher than Nokia’s…
Finland’s Nokia has reportedly priced the €1.2bn bridge loan package it is using to support its takeover of telecoms equipment venture Nokia Siemens Networks.
The loan comprises three tranches that were priced significantly higher than Nokia’s existing debt, reported Reuters citing sources.
Two of these tranches – a €500m bridge loan and a €300m bridge loan – are being syndicated. The third is a €400m short-term bridge loan that will not be syndicated by JP Morgan, which as previously reported is understood to be arranging the financing for Nokia’s €1.7bn acquisition.
Reuters reported that the €500m tranche will pay 650bps over LIBOR for the first three months, increasing to a maximum margin of 925 bps after nine months. The €300m bridge loan is priced at 200 bps for the first six months, and will rise to a maximum margin of 425 bps after 18 months.
This pricing represents a significant hike compared with the interest margin on Nokia’s existing €1.5bn loan, which pays 60bps.
Nokia announced plans to buy the remaining 50% of NSN from it German partner Siemens earlier this year. The remaining €500m of its €1.7bn deal will be in the form of a secured loan from Siemens due one year from closing, which the companies expect to take place later this summer.
Nokia was unable to comment on the financing before the press deadline.
