Edelman Financial launches $900 million add-on term loans, amendment

By Sara Rosenberg

New York, March 15 – Edelman Financial Engines (Edelman Financial Center LLC) held a lender call at 2:30 p.m. ET on Monday to launch $900 million of add-on term loans, according to a market source.

The debt consists of a fungible $800 million seven-year add-on first-lien term loan B and a fungible $100 million add-on second-lien term loan due July 2026, the source said.

The company also launched a $1,425,900,000 first-lien term loan B amendment and extension that would extend the maturity out to seven years, and an amendment of its existing $475 million second-lien term loan due July 2026.

Price talk on the covenant-lite first-lien term loan debt (B2/B) is Libor plus 350 basis points with 25 bps step-down based on first-lien net leverage and a 25 bps step-down following an initial public offering, and a 0.5% Libor floor. The add-on first-lien term loan is talked with an original issue discount of 99.5, and the amendment fee being offered for the existing term loan is 12.5 bps.

Pricing on the covenant-lite second-lien term loan debt (Caa2/CCC+) is Libor plus 675 bps with a 0% Libor floor. The add-on term loan is talked with an original issue discount of 99, and the amendment is being offered with a 25 bps consent fee, the source continued.

The first-lien term loan debt has 101 soft call protection for six months, and the second-lien term loan debt has 101 hard call protection for one year with a par call with an IPO.

Amortization on the first-lien term loan debt is 1% per annum.

Morgan Stanley Senior Funding Inc. and JPMorgan Chase Bank are the leads on the $2,800,900,000 of senior secured credit facilities, with Morgan Stanley the left lead and administrative agent on the first-lien debt and JPMorgan the left lead and administrative agent on the second-lien debt.

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

Proceeds from the add-on term loans will be used with cash on hand to fund a distribution to shareholders, and to pay related fees and expenses.

The company also announced on Monday a strategic investment from Warburg Pincus, which will become a minority equity owner.

The investment values the company at $7.3 billion and is expected to close in the second quarter.

Edelman, a Hellman & Friedman portfolio company, is a financial planning and investment management firm.

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