In an important test of its distribution firepower, NationsBank on Thursday will launch the syndication of a $3.25 billion acquisition loan for LDDS Communications Inc., the nation's fourth-largest long distance phone company.

LDDS, based in Jackson, Miss., will use the bank loan to finance its previously announced agreement to purchase the Wiltel long-distance telecommunications unit of Williams Cos. for $2.5 billion. Existing debt will also be refinanced.

The LDDS credit is believed to be the biggest acquisition loan for a noninvestment-grade borrower this year. It is also is the largest syndicated loan that NationsBank has led on its own.

Over the past few years, the Charlotte, N.C.-based superregional has established itself as a major player in the loan syndication market. NationsBank was the fourth-largest syndicator of loans in the first half of 1994, based on the dollar volume of deals it agented or co-agented, according to Loan Pricing Corp..

The knock against the bank from some of its competitors, though, is that NationsBank seldom plays the leading role in shepherding big-ticket deals through the market. As a result NationsBank's handling of the LDDS credit is likely to be closely watched.

NationsBank's balance sheet has a lot riding on the outcome of the syndication. The bank underwrote $1.5 billion of the $3.25-billion credit - its largest commitment ever to a noninvestment-grade borrower.

The remaining portion was underwritten by Bank of Nova Scotia, Credit Lyonnais, First Chicago Corp.'s First National Bank of Chicago, First Union, and Long Term Credit Bank of Japan.

Given the size and the high profile of the deal, it's notable that there are no New York money-centers in the underwriting group.

The syndication manager at one money-center said his bank had little interest in the credit, because it does not have much of a relationship with LDDS. However, the prospect of winning future securities underwriting business could entice some money-centers to participate as coagents on the bank loan.

Part of the LDDS credit - a $1.25 billion, two-year revolver - is essentially a bridge loan to a future public offering of debt or equity. The rest of the credit is in the form of a six-year revolver. Both parts are priced at 150 basis points over the London interbank offered rate.

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