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Meredith cuts spread on $1.8 billion term loan B to Libor plus 300 bps
By Sara Rosenberg
New York, Jan. 17 – Meredith Corp. reduced pricing on its $1.8 billion seven-year covenant-light term loan B to Libor plus 300 basis points from Libor plus 325 bps, according to a market source.
Also, the original issue discount on the term loan was tightened to 99.75 from 99.5, the source said.
The term loan still has a 0% Libor floor and 101 soft call protection for six months.
The company’s $2.15 billion of senior secured credit facilities (Ba2/BB) also include a $350 million five-year revolver.
RBC Capital Markets, Credit Suisse Securities (USA) LLC, Barclays and Citigroup Global Markets Inc. are the joint lead arrangers on the debt.
Recommitments are due at 10 a.m. ET on Thursday, the source added.
Proceeds will be used to help fund the acquisition of Time Inc. for $18.50 per share in an all-cash transaction valued at $2.8 billion and to refinance existing debt.
Other funds for the transaction are expected to come from $1.4 billion of senior unsecured notes and a $650 million preferred equity commitment from Koch Equity Development.
Closing is expected this quarter, subject to customary conditions and regulatory approvals, including the tender of a majority of the outstanding shares of Time common stock and clearance under the Hart-Scott-Rodino Antitrust Improvements Act.
Following the close of the transaction, the company is expected to have pro forma leverage of 2.9 times, including expected synergies.
Leverage is anticipated to decline to about 2 times by calendar year 2020.
Meredith is a Des Moines-based media and marketing company. Time is a New York-based media company.
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