London, April 11 - Cadbury Schweppes announced on Friday the completion of $4.4 billion in demerger loan facilities backing the separation of Cadbury Schweppes' Americas beverages business from its confectionary business.
The financing for the beverage business, Dr Pepper Snapple Group (DPSG), was arranged by JP Morgan, Bank of America, Goldman Sachs, Morgan Stanley and UBS.
The financing comprises a $2.2 billion, five-year term loan, a $500 million, five-year revolving credit facility and a $1.7 billion bridge loan.
The company said the non-bridge loan portion of the debt had been successfully syndicated to a group of 35 banks and due to strong demand the term loan facility was increased from $1.9 billion, while the bridge loan had been reduced by $300 million.
The company said the annual interest rate to be paid on the term loan, at current LIBOR rates, is expected to be in the region of 4.75 percent.
On Friday all the funds under the term loan and bridge loan will be placed into an escrow account of DPSG until the demerger becomes effective on May 7. DPSG intends to repay the bridge loan through the issuance of fixed-rate notes.
After the separation, the confectionary business and Americas Beverages businesses will operate as separately listed companies.
Cadbury Schweppes also announced it had signed additional committed facilities of 450 million pounds ($888.8 million) maturing in 2010. These facilities effectively extend a number of the company's bilateral agreements originally maturing in 2008.