Nalco looking to refinance debt

Naperville-based Nalco Co., the world's largest provider of industrial water-treatment services, cut pricing on a $650 million term loan B-1 it's seeking to refinance debt, according to a person familiar with the transaction.

The debt will pay 3 percentage points more than the London interbank offered rate, 0.25 percentage point less than initially offered, said the person who declined to be identified because the terms are private. Libor, the rate banks charge to lend to each other, will have a 1.5 percent floor, said the person.

Deutsche Bank AG, the bank arranging the financing, tightened the price at which it may sell the loan to 99.5 cents on the dollar, compared with 99 cents, the person said, reducing proceeds for the borrower and boosting the yield for investors.

Pricing on the term loan will be tied to ratings, meaning that when Nalco's corporate ratings are Ba1/BB+ the interest margin will step down to 2.75 percentage points more than Libor.