PowerSchool updates first- and second-lien term loan pricing

By Sara Rosenberg

New York, June 12 – PowerSchool Group LLC firmed pricing on its $775 million seven-year first-lien term loan (B2/B-) at Libor plus 325 basis points, the low end of the Libor plus 325 bps to 350 bps talk, and on its $365 million eight-year second-lien term loan (Caa2/CCC) at Libor plus 675 bps, the low end of the Libor plus 675 bps to 700 bps talk, according to market sources.

Also, a step-down was added to the first-lien term loan to Libor plus 300 bps at first-lien net leverage of 4.25 times and the original issue discount was tightened to 99.75 from 99.5, sources said.

Furthermore, the MFN was changed to 50 bps with a 12-month sunset from 75 bps with a six-month sunset.

As before, the first-lien term loan has a 0% Libor floor and 101 soft call protection for six months, and the second-lien term loan has a 0% Libor floor, a discount of 99 and call protection of 102 in year one and 101 in year two.

The company’s $1.26 billion of credit facilities also include a $120 million five-year revolver (B2/B-).

Barclays, Credit Suisse Securities (USA) LLC, Macquarie Capital (USA) Inc., Ares, Golub and Jefferies LLC are the bookrunners on the deal, with Barclays the left lead on the first-lien loan and Credit Suisse the left lead on the second-lien loan.

Recommitments were scheduled to be due at noon ET on Tuesday, sources added.

Proceeds will be used to help fund the buyout of the company by Onex Corp. and Vista Equity Partners. Vista is the current owner of the company but will invest new capital in the business with the purchase of a stake by Onex.

Concurrently with the Onex/Vista transaction, PowerSchool will acquire PeopleAdmin, a provider of cloud-based talent management solutions for the education sector.

Closing is expected in the second half of this year, subject to customary conditions and regulatory approvals.

PowerSchool is a Folsom, Calif.-based education technology platform for K-12 schools.

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