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RLPC-PPL seeks $11.5 bln loan for E.ON purchase-bankers

By Jacqueline Poh NEW YORK, May 10 (Reuters) - Utility PPL Corp is seeking $11.5 billion in financing to back its acquisition of a Kentucky-based unit from Germany's E.ON, banking sources told Thomson Reuters LPC. Bank of America Merrill Lynch, Credit Suisse and Wells Fargo are arranging the facility, the sources added. The financing consists of a $6.5 billion, 364-day bridge loan and a $5 billion revolving credit facility due December 2014. The bridge loan's pricing opens at 275 basis points over Libor while the revolver is priced at 200 basis points over Libor with a 25 basis points undrawn fee. Some banks have been invited to join both the bridge and revolver with commitments of $800 million or $500 million by Tuesday. Meanwhile, other banks have been invited to a bank meeting for a wider retail syndication on Thursday. General participants are only invited to join the revolver, one of the bankers said, while another source said the bridge is not expected to be funded as it will be taken out by a bond issue and equity. Last month, Moody's Investors Service downgraded the long-term unsecured ratings of PPL to Baa3 from Baa2. The company has a BBB rating from Standard & Poor's. The transaction is the largest acquisition deal in the power sector over the last two and a half years, according to Thomson Reuters data. PPL's $6.5-billion bridge pushes the overall bridge loan volume in the U.S. to date to $28 billion, according to Thomson Reuters LPC data. So far this year, the market has seen 13 bridge loans including PPL's facility, according to Thomson Reuters LPC. Previous deals include the $6.724 billion loan backing Air Products & Chemicals Inc's bid for Airgas Inc; the $5 billion bridge backing MetLife Inc's $15.5 billion acquisition of American Life Insurance Co; and the $6.1 billion loan that backs Comcast's acquisition of a 51 percent stake in NBC Universal. (Reporting by Jacqueline Poh; Editing by Derek Caney) Keywords: PPL/LOANS (jacqueline.poh@thomsonreuters.com; 646-223-5481; Reuters Messaging: jacqueline.poh.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved.

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