GEO gets $100 million three-year loan to finance buyout, redeem notes

By Susanna Moon

Chicago, Sept. 5 - GEO Group, Inc. said it obtained a new $100 million three-year term loan under its senior credit facility to redeem some notes and fund an acquisition.

Interest on the loan is Libor plus 275 basis points, which is the same as GEO's existing revolving line of credit, according to a company press release.

At the same time, GEO amended the facility to increase its initial restricted payment basket to $50 million and increase the senior secured leverage ratio test for access to the net income-based restricted payment basket to 2.75 times from 2.5 times.

Proceeds were used to redeem Municipal Corrections Finance, LP's 8.47% bonds for about $67 million in connection with GEO's acquisition of the company.

GEO acquired 100% of the partnership interests in Municipal Corrections for about $27 million.

GEO Group 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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