Software AG sets U.S. and euro term loan sizes, revises OIDs

By Sara Rosenberg

New York, Aug. 1 – Software AG (Mosel Bidco SE) firmed its U.S. seven-year term loan size at $405 million and its euro seven-year term loan size at €640 million, compared to talk at launch of €1 billion equivalent of U.S. and euro term loan debt (B2/B/BB-), with the U.S. piece to have a minimum size of $400 million, according to a market source.

Also, the original issue discount on the U.S. term loan was tightened to 99, from revised talk of 98.75 earlier in the day, revised talk of 98 prior to that and initial talk of 97, the source said.

The discount on the euro term loan was tightened to 98.75 from revised talk of 98 and initial talk of 97.

Pricing on the U.S. term loan is SOFR plus 475 basis points with a 25 bps step-down at 3.5x senior secured net leverage and a 0.5% floor, and pricing on the euro term loan is Euribor plus 475 bps with 25 bps step-downs at 3.5x and 3x senior secured net leverage and a 0% floor.

Both term loans have 101 soft call protection for six months, and ticking fees of half the margin for days 46 to 90 and the full margin thereafter.

Previously in syndication, pricing on the term loans was reduced from SOFR/Euribor plus 500 bps, a 25 bps pricing step-down at 2.5x senior secured net leverage was removed from the euro term loan, the margin ratchet holiday was modified to six months from three months, the ticking fees were revised from half the margin on days 121 to 180 and the full margin thereafter, and some other changes were made to documentation.

JPMorgan Chase Bank is the sole physical bookrunner on the deal. Banco Santander and Citigroup Global Markets Inc. are joint bookrunners.

With the additional change to the U.S. term loan original issue discount, the recommitment deadline was set for 2:15 p.m. ET, the source added.

Proceeds will be used to help fund the buyout of the company by Silver Lake for €32.00 per share, implying an equity value of Software AG of about €2.4 billion.

Closing is expected in the fourth quarter.

Software AG is a Darmstadt, Germany-based software company.

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