Cambium Learning reveals price talk on $575 million of term loans

By Sara Rosenberg

New York, Sept. 23 – Cambium Learning Group released price talk on its $575 million of term loans in connection with its lender call on Wednesday, according to a market source.

The fungible $425 million incremental first-lien term loan due December 2025 is talked with an original issue discount of 98, and the non-fungible $150 million incremental second-lien term loan due December 2026 is talked at Libor plus 850 basis points with a 1% Libor floor and a discount of 97, the source said.

Pricing on the incremental first-lien term loan is Libor plus 450 bps with a 0% Libor floor, in line with pricing on the existing $609 million first-lien term loan.

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

RBC Capital Markets, Deutsche Bank Securities Inc., KKR Capital Markets, Macquarie Capital (USA) Inc., Barclays and BMO Capital Markets are the joint lead arrangers on the deal.

Commitments are due at noon ET on Oct. 7, the source added.

Proceeds will be used to help fund the acquisition of Rosetta Stone Inc. for $30 per share, representing an equity value of about $792 million.

Other funds for the transaction will come from balance sheet cash and equity from Veritas Capital, the current owner of Cambium.

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

The company’s existing $223 million second-lien term loan is priced at Libor plus 850 bps with a 0% Libor floor.

Cambium is a Dallas-based end-to-end provider of K-12 instructional and assessment solutions. Rosetta Stone is an Arlington, Va.-based provider of digital literacy and language education solutions to K-12, consumer and enterprise customers.

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