S&P gives Delta Topco B-, loans B-, CCC

S&P said it assigned B- ratings Delta Topco Inc. and its $1.49 billion first-lien credit facility, consisting of a $200 million revolver and $1.29 billion term loan, with a 3 recovery rating. The agency also gave the $455 million second-lien term loan a CCC rating with a 6 recovery rating.

Warburg Pincus and Vista Equity Partners’ Fund VII will use the term loan proceeds and cash equity to buy Infoblox for $3.36 billion. Delta Topco, the borrower, will be the holding company for Infoblox.

“Although we expect leverage above 10x through fiscal 2022, FOCF-to-debt metrics and meaningful FOCF support our B- rating. Infoblox will increase debt to $1.75 billion at the close of the transaction, from $730 million, and double its annual cash interest expense to around $90 million to $100 million,” S&P said in a press release.

The outlook is stable.

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