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Blackboard sets first- and second-lien term loan talk with launch
By Sara Rosenberg
New York, Sept. 12 - Blackboard Inc. came out with price talk on its $780 million seven-year first-lien term loan (B+) and $350 million eight-year second-lien term loan (CCC+) as the debt was launched to lenders on Monday, according to a market source.
The first-lien term loan is being talked at Libor plus 550 basis points and the second-lien term loan is being talked at Libor plus 975 bps, with both tranches having a 1.5% Libor floor, the source said.
In addition, the first-lien term loan is being offered at an original issue discount of 96½ to 97 and the second-lien term loan is being offered at a discount of 97½ to 98, the source remarked.
There is soft call protection on the first-lien term loan of 102 in year one and 101 in year two, and the second-lien term loan is non-callable for one year, then at 102 in year two and 101 in year three.
The company's $1.23 billion senior secured credit facility also includes a $100 million five-year revolver (B+).
Bank of America, Merrill Lynch, Deutsche Bank Securities Inc. and Morgan Stanley & Co. Inc. are the lead banks on the deal, with Bank of America the left lead.
Commitments are due on Sept. 21, and closing is expected on Oct. 4.
Proceeds will be used to help fund the buyout of the company by Providence Equity Partners for $45 per share in cash. The transaction is valued at $1.64 billion, plus the assumption of $130 million of net debt.
Other funds for the acquisition will come from up to $850 million of equity.
Closing on the buyout is subject to stockholder approval, other customary conditions and regulatory approvals.
Blackboard is a Washington, D.C.-based provider of enterprise software applications and related services to the education industry.
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