Guidehouse discloses talk on $840 million of incremental term loans

By Sara Rosenberg

New York, Sept. 17 – Guidehouse revealed price talk on its fungible $640 million incremental covenant-lite first-lien term loan (B1/B-) and fungible $200 million incremental covenant-lite second-lien term loan (Caa1/CCC) in connection with its bank meeting on Tuesday, according to a market source.

The incremental first-lien term loan is talked at Libor plus 375 basis points to 400 bps with a 0% Libor floor and an original issue discount of 99, and the incremental second-lien term loan is talked at Libor plus 800 bps to 825 bps with a 0% Libor floor and a discount of 98.5, the source said.

The first-lien term loan is getting 101 soft call protection for six months and the second-lien term loan is getting hard call protection of 102 in year one and 101 in year two.

The company is also upsizing its existing revolving credit facility to $125 million from $50 million.

RBC Capital Markets, Macquarie Capital (USA) Inc., UBS Investment Bank and Credit Suisse Securities (USA) LLC are the leads on the deal.

Commitments are due on Oct. 1, the source added.

Proceeds will be used to help fund the acquisition of Navigant Consulting Inc. for $28 in cash per share in a transaction valued at about $1.1 billion.

Closing is expected in the fourth quarter, subject to regulatory approvals and customary conditions.

With this transaction, pricing on the company’s existing first-lien term loan will increase from Libor plus 300 bps and pricing on the existing second-lien term loan will be lifted from Libor plus 750 bps to match pricing on the incremental term loans.

Guidehouse, a portfolio company of Veritas Capital, is a provider of management consulting services to government clients. Navigant is a Chicago-based professional services firm.

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