Datatel tightens discount on upsized $1.075 billion term B to 98½

By Sara Rosenberg

New York, Dec. 15 - Datatel Inc. (Sophia LP) increased its 61/2-year term loan B to $1.075 billion from $1.07 billion and revised the original issue discount to 98½ from 98, according to a market source.

Pricing on the loan was left unchanged at Libor plus 500 basis points with a 1.25% Libor floor, and there is still 101 soft call protection for one year.

Recommitments were due at 5 p.m. ET on Thursday and allocations are expected Friday morning, the source said.

The company's now $1.2 billion credit facility (B1/B+), up from $1.195 billion, also includes a $125 million five-year revolver priced at Libor plus 475 bps with no Libor floor.

Bank of America Merrill Lynch, Barclays Capital Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC and J.P. Morgan Securities LLC are the lead banks on the deal.

Financial covenants include a maximum total leverage ratio.

Proceeds will be used to help fund the acquisition of SunGard Higher Education by Hellman & Friedman LLC and the concurrent merger with Datatel, an existing Hellman & Friedman portfolio company.

Other funds are expected to come from $530 million of bonds, which are backed by a $530 million senior unsecured bridge loan.

The additional proceeds from the term loan B upsizing will be used to fund the original issue discount, the source added.

Under the agreement, Hellman & Friedman is buying SunGard Higher Education from SunGard Data Systems Inc. for $1.775 billion in cash.

Once SunGard Higher Education is merged with Datatel, the combined company will operate under a new name that will be announced by the parties at the closing of the transactions.

Closing is subject to customary conditions, including applicable regulatory clearances. It is not subject to a financing condition or receipt of any stockholder approvals.

Datatel is a Fairfax, Va.-based provider of technology products, services and insight to higher education. SunGard Higher Education is a Malvern, Pa.-based provider of software and services to the higher education community.

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