GEO launches $250 million credit facility at Libor plus 275-300 bps

By Sara Rosenberg

New York, Jan. 19 - GEO Group launched its $250 million credit facility on Wednesday with price talk of Libor plus 275 basis points to 300 bps with no Libor floor, according to a market source.

BNP Paribas is the lead bank on the deal.

The facility consists of a $100 million revolver and a $150 million term loan A-2, and the tranches are being sold as a strip to a target audience of banks, not institutional investors.

Proceeds will be used to help fund the acquisition of Behavioral Interventions Inc., a Boulder, Colo.-based provider of electronic monitoring services, for $415 million in an all-cash transaction, excluding transaction-related expenses.

The acquisition is expected to increase GEO's total annual revenues by about $115 million to more than $1.6 billion in 2011, and it is also expected to materially increase GEO's EBITDA and cash flow on a fully annualized basis.

Closing on the transaction is anticipated in the first quarter, subject to approval by federal regulatory agencies as well as other customary conditions.

GEO is a Boca Raton, Fla.-based provider of correctional, detention and residential treatment services to federal, state and local government agencies.

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