McGraw-Hill Education withdraws $250 million PIK toggle notes offer

By Paul A. Harris

Portland, Ore., Dec. 8 – McGraw-Hill Education, Inc. withdrew its proposed $250 million offering of MHGE Parent, LLC and MHGE Parent Finance, Inc. senior PIK toggle notes (Caa1/CCC+), according to an informed source.

Recent news on the deal was characterized by concessions to potential investors. Price talk widened and call protection increased. Most recent talk had the notes coming with a 10% coupon at a reoffer price of 99. Earlier talk was in the 9½% area. Call protection was increased to two years from one year.

Credit Suisse Securities (USA) LLC was the lead bookrunner.

The New York-based provider of education materials had planned to use the proceeds to refinance its MHGE HoldCo notes.

The refinancing also includes a $150 million term loan. The company intends to go forward with the loan, which is set to price and allocate on Friday, the source said.

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