TACA Lands Tighter High Yield Loan

Central American airline TACA has closed a $100m 5-year structured loan syndication through Citi paying at 600bp over Libor, tight to 625bp initial pricing. The amortizing deal has 1 year of grade and an average life around 3.2 years. Some 16 banks were heard signing on, most of them from Central America. The deal was pulled last year and was adjusted in price to reflect tighter prevailing market conditions. The facility will be repaid primarily by airline ticket sales using a trust structure based in Panama to isolate the payment streams. The transaction was heard well oversubscribed. Chadbourne & Parke was counsel to Citi, which acted as admin agent and lender.