Solera ups term B to $2.2 billion, firms at Libor/Euribor plus 475 bps

By Sara Rosenberg

New York, Feb. 26 – Solera Holdings Inc. upsized its seven-year U.S. and euro senior secured term loan B to $2.2 billion equivalent from $1.9 billion equivalent and firmed pricing at Libor/Euribor plus 475 basis points, the high end of the Libor/Euribor plus 450 bps to 475 bps talk, according to a market source.

Also, the original issue discount on the term loan B widened to 97 from 98, and the 101 soft call protection was extended to one year from six months with the exception for dividend recapitalization deleted, the source said.

In addition, the 12 month MFN sunset was removed, the incremental freebie was reduced to $300 million from $475 million and the EBITDA grower was eliminated, the unlimited restricted payments basket was reduced to 4.75 times total net leverage from 5.25 times and the unlimited investment basket was reduced to 5.25 times total net leverage from 5.75 times.

Furthermore, the excess cash flow sweep was changed to 50% with step-downs to 25% at 2.5 times first-lien secured leverage, from 2.75 times, and 0% at 2 times first-lien secured leverage, from 2.25 times.

Other revisions included, among other things, reducing the general basket for investments to $150 million from $210 million with grower, reducing the general basket for debt to $150 million from $210 million with grower, reducing the starter basket on the Available Amount basket to $50 million from $140 million, and removing the basket for dividends on Designated Preferred Stock, the source continued.

The term loan B still has a 1% floor.

Amortization on the term loan B is 1% per annum.

The company’s now $2.5 billion senior secured credit facility (Ba3/B), up from $2.2 billion, also includes a $300 million revolver.

Recommitments are due at noon ET on Monday, with pricing expected that afternoon, the source added.

Goldman Sachs Bank USA, Citigroup Global Markets Inc., Jefferies Finance LLC, Macquarie Capital (USA) Inc., Nomura Securities International Inc. and UBS AG are the lead banks on the deal.

Proceeds will be used to help fund the buyout of the company by Vista Equity Partners for $55.85 per share. The transaction is valued at $6.5 billion, which includes Solera’s existing net debt.

Other funds for the transaction are expected to come from bonds, over $3 billion in equity and cash on hand.

Closing is expected during the week of Feb. 29.

Solera is a Westlake, Texas-based provider of software and services to the automobile insurance claims processing industry.

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