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Science Applications flexes $570 million term B to Libor plus 300 bps
By Sara Rosenberg
New York, April 16 – Science Applications International Corp. reduced pricing on its $570 million seven-year senior secured covenant-light term B (Ba2/BB) 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 changed to 99¾ from 99½, the source said.
The term loan still has a 0.75% Libor floor, 101 soft call protection for six months and amortization of 1% per annum.
The deal has an incremental allowance of $345 million or such other amount so long as pro forma senior secured leverage is 3.5 times or less, subject to 50 bps MFN.
Mandatory prepayments are 50% of excess cash flow, subject to senior secured leverage-based step-downs to 25% and 0%, 100% of asset sale proceeds, subject to reinvestment rights, and 100% of debt issuance proceeds, subject to baskets.
Commitments continue to be due at 5 p.m. ET on Friday, the source added.
Citigroup Global Markets Inc., Bank of America Merrill Lynch, PNC Capital Markets LLC, SunTrust Robinson Humphrey Inc., UBS AG and Wells Fargo Securities LLC are the joint lead arrangers on the deal.
Proceeds will be used to help fund the acquisition of Scitor Corp. for $790 million in an all cash transaction from Leonard Green & Partners.
Closing is expected on May 4, subject to customary conditions.
Science Applications is a McLean, Va.-based technology integrator providing full life-cycle services and solutions in the technical, engineering, and enterprise information technology markets. Scitor is a provider of systems engineering, financial and management consulting, information services and other services for corporate customers and government programs.
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