Ancestry.com finalizes $670 million term loan at Libor plus 575 bps

By Sara Rosenberg

New York, Dec. 17 - Ancestry.com finalized pricing on its $670 million seven-year covenant-light term loan at Libor plus 575 basis points, the high end of the revised Libor plus 550 bps to 575 bps talk and wide of initial talk of Libor plus 475 bps to 500 bps, according to a market source.

Also, the original issue discount on the term loan was changed to 96 from revised talk of 98 to 99, and initial talk of 99, the source said.

The 1.25% Libor floor was left unchanged.

The loan has 101 soft call protection for one year, which was added at the time of the first pricing changes.

The $720 million senior secured credit facility (B1/B+) also includes a $50 million five-year revolver.

Included in the deal is a 75% excess cash flow sweep with step-downs to 50% at total secured leverage of 3 times and to 25% at total secured leverage of 2 times.

Furthermore, there is a $25 million general dividends basket, 25 bps of MFN with no sunset provision and an accordion feature of $150 million plus an additional amount up to 3.5 times total net secured leverage.

Commitments were due by 2 p.m. ET on Monday, the source said.

Barclays, Morgan Stanley Senior Funding Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and RBC Capital Markets LLC are the lead banks on the deal.

Proceeds will be used to help fund Permira Funds' buyout of the company for $32.00 per share in cash in a transaction valued at $1.6 billion.

Other funds for the transaction will come from $300 million of senior unsecured notes and up to $503 million of equity from Permira; and from $100 million of equity that Spectrum Equity, which owns about 30% of the company's shares, will exchange for shares in the acquired company.

Additionally, Timothy Sullivan, president and chief executive officer of the company, and Howard Hochhauser, chief financial officer and chief operating officer, have agreed to roll over a substantial majority of their respective shares of Ancestry.com's common stock.

Closing is expected in early 2013, subject to stockholder approval and other customary conditions.

Senior secured leverage is 3.9 times and total leverage is 5.6 times.

Ancestry.com is a Provo, Utah-based online family history resource.

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