Netsmart tightens terms on incremental, repriced second-lien loan

New York, May 21 – Netsmart Inc. tightened pricing on its $167.5 million incremental first-lien term loan (B-) due April 2023 and the repricing of its existing $167 million second-lien term loan due October 2023, according to a market source.

The incremental loan is now offered at par instead of 99.75 previously, and the coupon on the second-lien repricing was trimmed to Libor plus 750 basis points from Libor plus 775 bps.

The incremental loan still has a coupon of Libor plus 375 bps with a 1% floor.

A parallel repricing of the $478 million existing first-lien term loan (B-) due April 2023 is unchanged, continuing to be offered at par and with the same coupon of Libor plus 375 bps with a 1% floor as the incremental tranche.

Other terms on the second-lien repricing are also unchanged, including an offer price of par and a 1% floor.

Golub Capital and KKR Capital Markets are the leads on the deal. UBS Investment Bank is the administrative agent.

Proceeds from the incremental loan will be used to fund an acquisition, and the repricing will take the existing first-lien term loan down from Libor plus 450 bps with a 1% Libor floor and the existing second-lien term loan down from Libor plus 950 bps with a 1% Libor floor.

Along with this transaction, the company is asking to eliminate the financial covenants from its first- and second-lien term loans.

The commitment deadline is unchanged at 12 p.m. ET on May 23.

Netsmart is an Overland Park, Kan.-based IT company focused on health and human services.

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