DTI Holdco finalizes term loan B pricing at Libor plus 525 bps

By Sara Rosenberg

New York, Sept. 23 – DTI Holdco Inc. firmed pricing on its $1,195,000,000 seven-year covenant-light term loan B at Libor plus 525 basis points, the high end of revised talk of Libor plus 500 bps to 525 bps and wide of initial talk of Libor plus 450 bps to 475 bps, according to a market source.

The term loan B has a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year.

On Thursday, the call protection was extended from six months, the 18-month MFN sunset was eliminated, and the incremental allowance was changed to $100 million from $150 million, plus unlimited amounts up to 4.5 times net secured leverage, revised from 5 times net secured leverage, and 5.5 times net total leverage.

The company’s $1,295,000,000 credit facility (B2/B) also includes a $100 million revolver.

Bank of America Merrill Lynch, Goldman Sachs Bank USA, Antares Capital, Ares Capital Management LLC and Golub Capital LLC are the leads on the deal.

Proceeds will be used to help fund the buyout of Epiq Systems Inc. by Omers Private Equity and Harvest Partners LP, and combination of Epiq with DTI, which is majority-owned by Omers.

Epiq is being purchased for $16.50 per share in cash. The transaction has a total value of about $1 billion, including assumed debt obligations.

Other funds for the transaction will come from up to $490 million of equity.

Closing is expected in the fourth quarter, subject to customary conditions, including receipt of shareholder and regulatory approvals.

DTI is an Atlanta-based legal process outsourcing company. Epiq is a Kansas City, Kan.-based provider of integrated technology and services for the legal profession.

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