Zix plans $200 million credit facilities for AppRiver purchase

By Sara Rosenberg

New York, Jan. 15 – Zix Corp. has received a commitment for $200 million of five-year credit facilities to help fund its acquisition of AppRiver, according to a news release.

SunTrust Bank and KeyBanc Capital Markets provided the debt commitment.

The facilities consist of a $25 million revolver and a $175 million term loan.

Pricing on the debt is expected to be Libor plus 350 basis points with future step-downs as Zix’s leverage reduces.

Amortization on the term loan is anticipated to be 0.25% per quarter, with annual excess cash flow prepayments if the company’s total leverage ratio exceeds certain thresholds.

The debt financing is expected to include a maximum total net leverage ratio covenant.

There will be no prepayment fee under the credit facilities.

Zix is buying AppRiver, a provider of cloud-based cybersecurity solutions, for $275 million in cash.

Other funds for the transaction will come from a $100 million convertible preferred equity investment from True Wind Capital.

Zix is a Dallas-based provider of e-mail security.

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