By Michelle Sierra and Leela Parker

(Reuters) - Billionaire investor Carl Icahn and Jefferies & Co have lined up $5.2 billion in loan commitments backing Icahn's leveraged recapitalization plans for computer manufacturer Dell Inc, sources told Thomson Reuters LPC.

Icahn did not return immediate calls for comment.

Banks and institutional investors have signed up to participate in the loan package at the initial structure and price guidance.

Circling the debt financing marks a critical step forward for Icahn's and Southeastern Asset Management's alternative bid for the company. Icahn and Southeastern are asking shareholders to tender 1.1 billion shares at $14 apiece.

The tender offer compares with founder Michael Dell's and Silver Lake Partners' $24.4 billion buyout at $13.65 a share, a price Icahn said substantially undervalues the company.

Icahn was expected to have the financing ready by Monday, ahead of an ISS meeting that could take place as early as this week. ISS is a shareholder advisory group that is expected to publish its view on Dell's bid. A July 18 shareholder vote on Dell's take private plan will follow.

LOAN PACKAGE

The $5.2 billion financing includes a $2.2 billion, six-year term loan B-1 and a $3 billion, 3.5-year term loan B-2.

Pricing on the TLB-1 is set at LIB+400 with a 1 percent Libor floor, while pricing on the TLB-2 is set at LIB+350 with a 75 basis-point Libor floor. Both tranches are offered at a discount of 99.5 cents on the dollar and will carry 101 soft call protection for one year.

The pricing, original issue discount and fee structure, as well as low leverage of 1.7 times, made the loan package attractive to investors, said sources evaluating the transaction.

As an unusual perk, lenders will share in the profits if a different but higher bid prevails. Joint lead arrangers will earn 7.5 percent of the difference between the winning bid and Dell's current $13.65 per share offer times the roughly 227 million shares that Icahn and Southeastern jointly own.

The loan also pays a 1.5 percent underwriting fee and a 2 percent arrangement fee. The six-year tranche will have standard 1 percent amortization, while the shorter-dated tranche amortizes at 10 percent per year.

Icahn's proposed tender offer will be financed with $7.5 billion of cash on the balance sheet, the $5.2 billion credit facility and $2.9 billion from the sale of receivables.

If Icahn's alternative proposal prevails, the loans would launch to a broader range of institutional investors before September 30, or the three-month commitment period of the $5.2 billion loans, according to sources.

(Reporting by Michelle Sierra and Leela Parker; Editing by Gerald E. McCormick and Caleb Frazier)

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