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GEO Group seeks $700 million term loan B at Libor plus 250-275 bps
By Sara Rosenberg
New York, Feb. 24 – The GEO Group Inc. is shopping a $700 million seven-year term loan B (BB+) at price talk of Libor plus 250 basis points to 275 bps with a 0.75% Libor floor and an original issue discount of 99.5, according to a market source.
The term loan has 101 soft call protection for six months, the source said.
Covenants include maximum total leverage, maximum secured leverage and minimum interest coverage ratios.
BNP Paribas Securities Corp. is the lead on the deal that launched with a lender call on Thursday.
Commitments are due at the close of business on March 9, the source added.
Proceeds will be used to repay an existing term loan B and to fund the acquisition of Community Education Centers for $360 million in an all-cash transaction, excluding transaction related expenses.
Closing on the acquisition is expected in the second quarter, subject to customary conditions.
GEO is a Boca Raton, Fla.-based real estate investment trust specializing in the design, financing, development, and operation of correctional, detention and community reentry facilities. Community Education Centers is a West Caldwell, N.J.-based provider of rehabilitative services for offenders in reentry and in-prison treatment facilities as well as management services for correctional and detention facilities.
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