Greenberg Traurig corporate shareholder Kara MacCullough led a team of U.S. attorneys in closing a $3.65 billion financing deal for a Boca Raton company that provides infrastructure for wireless communications.
MacCullough, who works mostly in Fort Lauderdale plus the firm’s Washington office, represented SBA Communications Corp., a publicly traded company that builds, manages and owns wireless communications infrastructure such as cell towers. The financing also was for SBA’s wholly owned subsidiary SBA Senior Finance II LLC.
The April 11 deal breaks down to a $2.4 billion term loan and a $1.25 billion in revolving credit. The term loan is for seven years with most of the $2.4 billion due at the end. The revolving credit is for five years and works differently than the term loan. Instead of borrowing and repaying the $1.25 billion once, SBA can borrow multiple times and then repay it, much like a credit card.
“They may never use the $1.25 billion, but it’s evidence of how much confidence the banks have in them that they said, ‘You could have up to $1.25 billion.’ What’s important about the credit facility is that they committed it to be there for five years,” MacCullough said. “You and I have a credit card that we use as revolvers, but the day we are late or the day we have a problem Visa or American Express can cut us off.”
The $2.4 billion was used to repay $1.93 billion in outstanding loans and for general corporate purposes, according to MacCullough. The $1.25 billion could be used by SBA to buy or build more towers and to buy back stock.
TD Securities and Mizuho Bank Ltd. were the lead lenders in a syndicate.
Other Greenberg Traurig team members involved in the financing were banking and financial services shareholder Timothy Bratcher in Atlanta, corporate shareholder William Donovan in Boston and corporate associates Grant Levine and John Meyer in Fort Lauderdale.
The high-value loan is largely due to SBA’s size as a company, MacCullough said.
“It’s probably one of the largest credit agreements that we’ve done down here. We don’t have a lot of clients that are big enough to do that size of credit facilities,” she said. ”It’s a very big company in our backyard, but very few people have heard of it because they are not the person that you get your cell phone from, but they are the person that if they are not there, your cell phone doesn’t work.”
This deal presented some challenges, notably a tight timeline to close.
Initially, SBA planned on borrowing sometime in 2018.
“But market conditions led the CEO (Jeffrey Stoops) to decide that basically we are going to do this now,” MacCullough said. “Obviously we are in a rising interest rate environment, and he thought it was important to get this deal done right now. We had less than a week and a half to get this done, to renegotiate all the covenants, line up everything, help them get ready for the marketing of the transaction before signing.”
Deals like this are generally are done over months, she noted.
MacCullough has represented SBA as outside attorney for capital markets and financing since 1999. The company was founded in 1989.
“I have grown up with SBA,” she said. “Every facility I have done for them gets a little bit bigger and a little bit bigger.”
The company has a market capitalization of $19.5 billion and ended 2017 with total debt of $9.4 billion. Revenue totaled $1.73 billion last year.