Cengage Learning to launch $300 million tack-on term loan on Tuesday

By Sara Rosenberg

New York, Dec. 8 – Cengage Learning Acquisitions Inc. is set to hold a conference call at 11:30 a.m. ET on Tuesday to launch a fungible $300 million tack-on covenant-light senior secured term loan due March 31, 2020, according to a market source.

Credit Suisse Securities (USA) LLC is the lead bank on the deal.

The tack-on term loan is talked at Libor plus 600 basis points with a 1% Libor floor, in line with the existing term loan, the source said, adding the that original issue discount is still to be determined.

The tack-on loan, as well as the existing $1,741,000,000 term loan, will get 101 soft call protection for six months.

Commitments are due on Friday.

Proceeds from the new debt will be used to fund a dividend to shareholders.

Other funds for the up to $350 million dividend will come from $50 million of issuer’s cash.

The dividend is expected to be paid on Dec. 30.

Cengage is a Stamford, Conn.-based provider of teaching, learning and research services for the academic, professional and library markets.

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