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DG FastChannel details $590 million facility for MediaMind purchase
By Sara Rosenberg
New York, June 24 - DG FastChannel Inc. released the structure and expected pricing on its proposed $590 million credit facility that will be used to help funds its acquisition of MediaMind Technologies Inc., according to an SC TO-T filed with the Securities and Exchange Commission on Friday.
J.P. Morgan Securities LLC and Bank of America Merrill Lynch are the lead banks on the deal.
The facility consists of a $100 million five-year revolver and a $490 million seven-year term loan B.
Pricing on the term loan is expected at Libor plus 350 basis points with a 1.25% Libor floor and an original issue discount of 991/2, and the revolver is anticipated to initially be priced at Libor plus 275 bps with a 50 bps unused fee. The spread on the revolver can range from Libor plus 200 bps to 300 bps based on leverage.
Financial covenants include a total leverage ratio of 3.75 to 1.00 with step-downs to be agreed and a minimum fixed-charge coverage ratio of 1.50 to 1.00.
Under the terms of the agreement, DG FastChannel will purchase MediaMind for $22 per share in cash through a tender offer.
The total transaction value is $517 million equity value or $414 million enterprise value, taking into account over $100 million in cash on MediaMind's balance sheet.
Closing is expected in the third quarter, subject to the successful completion of the tender offer, regulatory approval and customary conditions.
DG FastChannel is an Irving, Texas-based provider of digital media services to the advertising, entertainment and broadcast industries. MediaMind is a New York-based provider of integrated digital advertising services.
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