Williams Communications Signs Pact for $950 Million of Added Loans

Williams Communications(WCG Quote) said Monday that Citicorp USA and Lehman Commercial Paper have agreed to underwrite an additional $950 million of loans for the company, bringing the communication services concern's total senior credit facilities to $2 billion.

Williams, which provides voice, data, Internet and video services to communications service providers, said it expects to complete the deal this month. Salomon Smith Barney and Lehman Brothers are acting as joint lead arrangers and joint book managers for the add-on facility.

Shares of Williams Communications gained 19 cents, or 1.5%, to $12.94 in recent New York Stock Exchange trading.

"Upsizing our bank credit facility is one more important step in positioning Williams Communications to fully fund our business plan,'' the company said in a statement. "This financing plan, including the capital restructuring agreement announced last week, is key to our preparation for a possible tax-free spin-off of Williams Communications shares to Williams'(WMB Quote) shareholders by mid-year.''

Williams Communications said last week that it is exchanging stock for assets, including an intercompany note, with energy company Williams, its parent and chief shareholder.