Macrovision to reduce debt needed for Gemstar purchase with asset sale proceeds

By Sara Rosenberg

New York, Feb. 14 - Macrovision Corp. plans on using proceeds from the sale of its software business unit to Thoma Cressey Bravo to reduce the debt funding requirements for its pending acquisition of Gemstar-TV Guide International, Inc., according to an 8-K filed with the Securities and Exchange Commission Thursday.

The approximately $200 million cash transaction with Thoma Cressey is expected to close on or before April 1, subject to customary conditions, including regulatory approvals.

As was previously reported, Macrovision is planning on getting a new $650 million five-year term loan B and has received a commitment for a $150 million bridge loan to help fund its acquisition of Gemstar-TV Guide.

The term loan B has 101 call protection for one year against voluntary prepayments.

If the company's leverage ratio is greater than 2.5 to 1 and more than $50 million in total principal amount of Macrovision's 2.625% convertible senior notes due 2011 remain outstanding 180 days prior to their scheduled maturity, the term loan B will become due on that 180th day.

The bridge loan is expected to be taken out with senior unsecured notes or convertibles.

JPMorgan and Merrill Lynch are the lead banks on the financing.

The Gemstar acquisition is expected to close by early second quarter 2008, subject to shareholder approval, and other customary conditions.

Macrovision is a Santa Clara, Calif.-based provider of services that enable businesses to protect, enhance and distribute their digital goods to consumers across multiple channels.

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