Engility plans $150 million of add-on loans for Dynamics Research buy

By Sara Rosenberg

New York, Dec. 23 - Engility Corp. received a commitment for a $150 million of incremental senior secured credit facility debt due Aug. 9, 2018 to help fund its acquisition of Dynamics Research Corp., according to an 8-K filed with the Securities and Exchange Commission on Monday.

Bank of America Merrill Lynch is the lead bank on the deal and has committed to provide $50 million of the financing while using commercially reasonable efforts to syndicate the remainder.

The debt consists of a $75 million add-on term loan and a $75 million add-on revolver.

Pricing on the add-ons will match existing term loan and revolver pricing.

Under the agreement, Engility will commence a tender offer for all outstanding shares of Dynamics Research common stock at a price of $11.50 in cash for each outstanding share.

Other funds for the transaction will come from cash on hand.

Closing is expected in the first quarter of 2014, subject to customary conditions and regulatory approval.

Engility is a Chantilly, Va.-based pure-play government services contractor. Dynamics Research is an Andover, Mass.-based U.S. government services, information technology and management consulting firm.

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