Google Inc is expected to close a $3 billion, three-year revolving credit facility this week, marking its first visit to the syndicated loan market, Jacqueline Poh of Thomson Reuters LPC reports.
JP Morgan, Morgan Stanley and Goldman Sachs are lead arrangers on the deal. Proceeds are for general working capital, according to the report, which cited banking sources.
The facility features market-based pricing. Sources are using recent top high-grade deals as the benchmark for pricing on Google's maiden deal, the report said.
The high-grade names have been setting benchmark pricing this year, with Wal-Mart Stores Inc setting the lowest record with a 2.5 basis point undrawn fee for its $11.225 billion facility. Pricing, based on the company's one-year CDS, starts at a floor of 10 basis points and a cap of 75 basis points.
Meanwhile, top technology names such as Automatic Data Processing recently sealed a $4 billion revolver that priced at 50 percent of the five-year Markit CDX.NA.IG Series 12. The undrawn fee was 8 basis points for the three-year tranche, according to the report.
Google shares were down 3 percent at $457.78 in afternoon Nasdaq trade.
Thomson Reuters LPC is a Thomson Reuters publication.