Output Services reveals talk on $497 million equivalent term loans

By Sara Rosenberg

New York, June 27 – Output Services Group Inc. (OSG Billing Services) released price talk on its roughly $497 million equivalent of term loans with its bank meeting on Thursday, according to a market source.

The roughly $232 million equivalent sterling-denominated incremental first-lien term loan (B3) due March 2024 is talked at Libor plus 500 basis points with a 1% Libor floor and an original issue discount of 98.5, and the roughly $265 million second-lien term loan (Caa3) due September 2024 is talked at Libor plus 875 bps to 900 bps with a 1% Libor floor and a discount of 97.5, the source said.

The first-lien term loan has 101 soft call protection for six months and a total net leverage ratio covenant of 7.5x with step-down to 7x, 6.5x and 6x, and the second-lien term loan has call protection of 102 in year one and 101 in year two and a total net leverage ratio covenant of 8.55x with step-downs to 8.05x, 7.55x and 7.05x.

Barclays is the arranger on the deal.

Commitments are due at noon ET on July 12, the source added.

Proceeds will be used to take out the existing M&A financing and bring Communisis into the existing financing credit group.

Output Services is a Ridgefield Park, N.J.-based provider of billing and customer communications services.

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