Epicor Software first- and second-lien term loans steady with buyout news

By Sara Rosenberg

New York, Aug. 31 – Epicor Software Corp.’s first- and second-lien term loans held firm in trading on Monday following news that Clayton, Dubilier & Rice entered into an agreement to purchase the company from KKR in a transaction valued at $4.7 billion.

The first-lien term loan was quoted at par bid, par ½ offered and the second-lien term loan was quoted at 102¾ bid, 103¾ offered, both unchanged on the day, a trader remarked.

The trader said that the term loans are portable. “Why would they replace a deal just done last month with the clear purpose of stapling it to this transaction?” he added.

In July, the company completed syndication of a dividend recapitalization transaction that consisted of $1.925 billion first-lien term loan priced at Libor plus 425 basis points with a 1% Libor floor and sold at an original issue discount of 98, and a $425 million second-lien term loan priced at Libor plus 775 bps with a 1% Libor floor and issued at a discount of 98.5.

The first-lien term loan has 101 soft call protection for one year. The second-lien term loan is non-callable for one year, then at 102 in year two and 101 in year three, with the call protection resetting upon a change of control.

Epicor is an Austin, Tex.-based provider of enterprise business software services.

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