A Credit-Suisse-led arranger group has set final pricing the $4.25 billion, five-year A term loan backing Avago Technologies’ purchase of Broadcom at L+150-200, tied to a ratings-based grid.

As reported, the arrangers upsized the TLA by $1 billion, to $4.25 billion, and originally committed to provide $12.25 billion of syndicated term debt, including an institutional loan that hasn’t yet come to market.

Credit Suisse, Bank of America Merrill Lynch, Deutsche Bank, Barclays, Citigroup, and Wells Fargo are acting as joint lead arrangers, while Nomura, BMO, and Bank of Tokyo-Mitsubishi UFJ are acting as co-managers. Bank of America is left lead on the TLB.

The term loan will amortize at 5% in each of the first three years, stepping to 10% in year four, with the remaining 75% due in the final year. The loan is governed by a net-first-lien-secured-leverage test.

The pro rata facility also includes a $500 million, five-year revolver.

Avago is currently rated BB+/Ba2.

Avago Technologies in May disclosed that it planned to finance its $37 billion purchase of Broadcom with new term loans, and will also refinance $6.5 billion of existing debt facilities. Avago’s roughly $4.6 billion B term loan due 2021 (L+300, 0.75% LIBOR floor) was issued at 99.5 in April 2014 to support its $6.6 billion acquisition of LSI Corp.

The transaction is expected to leverage Avago at roughly 2.7x. Net of $1.3 billion of cash on hand, adjusted leverage would fall to 2.5x.

Enterprise value of the combined company would be roughly $77 billion. The combined company will have annual revenue of approximately $15 billion. – Staff reports