S&P: Activant unchanged

Standard & Poor's said its ratings and outlook on Activant Solutions Inc. (B/stable) would not be affected by the company's recently announced acquisition of Intuit's Eclipse Distribution Management Solutions business.

The acquisition is expected to expand Activant's customer base and bolster its technology offerings in the wholesale distribution segment, the agency said, noting that the purchase price of Intuit's Eclipse will be $100 million, subject to certain adjustments.

Financing is expected to come from a new incremental term loan facility of up to $125 million, leverage is expected to be higher as a result, S&P noted.

Although this proposed transaction is expected to increase Activant's operating-lease adjusted debt leverage, the company's improved operating efficiencies and consistent free cash flow generation provide capacity for additional debt at the current rating, S&P added.

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