WisdomTree closes $250 million credit facilities for acquisition

By Wendy Van Sickle

Columbus, Ohio, April 13 – WisdomTree Investments Inc. entered into a credit agreement on Wednesday that provides for $250 million of senior secured credit facilities that helped fund its acquisition of ETF Securities’ European exchange-traded commodity, currency and short- and-leveraged business, according to an 8-K filed late Friday with the Securities and Exchange Commission.

The facilities consist of a $50 million three-year revolver and a $200 million three-year term loan and were entered in connection with the closing of the acquisition.

The revolver initially bears interest at Libor plus a margin of 125 basis points, with the margin subject to increase to up to 150 bps, depending on total leverage ratio. There is a facility fee of 50 bps of the actual daily amount the aggregate commitments, whether used or unused, under the revolver, with the exact fee to be based on total leverage ratio.

The term loan initially bears interest at Libor plus a margin of 175 bps, with the margin subject to increase to up to 200 bps or to drop to 112.5 bps, depending on total leverage ratio.

The revolver and term loan mature on April 11, 2021. The term loan does not amortize.

Credit Suisse Securities (USA) LLC and Bank of America Merrill Lynch were the joint lead arrangers and bookrunners.

Royal Bank of Canada, BMO Capital Markets, Fifth Third Bank and PNC Capital Markets LLC were the co-lead arrangers, Standard Chartered Bank is a co-arranger and Bank of America, NA is the syndication agent.

The company must maintain a maximum total leverage ratio of 2.75x initially, stepping down to 2.5x for the quarter ending June 30, 2019, to 2.25x times for the quarter ending March 31, 2020 and to 2x for the quarter ending Sept. 30, 2020 and thereafter.

The revolver may be used for working capital, capital expenditures and general corporate purposes.

Other funds for the transaction came from cash on hand and a stock consideration consisting of 15.25 million shares of common stock and 14,750 shares of a new class of series A non-voting preferred stock that is convertible into an aggregate of 14.75 million shares of common stock.

WisdomTree is a New York-based exchange-traded fund and exchange-traded product sponsor and asset manager.

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