Fundtech talks $200 million term loan at Libor plus 600 bps

By Sara Rosenberg

New York, Oct. 26 - Fundtech Ltd. released price talk on its $200 million six-year term loan at Libor plus 600 basis points with a 1.5% Libor floor and an original issue discount in the 97 area, according to a market source.

There is 101 soft call protection for one year.

Commitments are due on Nov. 8.

The company's $225 million senior secured credit facility also includes a $25 million five-year revolver.

RBC Capital Markets and BMO Capital Markets are the joint lead arrangers and bookrunners on the deal that launched with a bank meeting on Tuesday, with RBC the administrative agent.

Amortization on the term loan is 1% per annum.

Proceeds will be used to help fund the buyout of the company by GTCR and refinance existing debt.

Under the agreement, GTCR is buying Fundtech for $23.33 in cash per ordinary share and will then combine the company with its existing portfolio company, BankServ. The debt at BankServ will be refinanced with this merger.

Other funds for the transaction will come from $175 million of equity. Although when combined with BankServ, there will be close to $350 million in equity and $50 million of eight-year senior subordinated mezzanine financing from Newstone Capital Partners.

Senior leverage is around 4.0 times and total leverage is just above 5.0 times.

Closing is expected in the fourth quarter, subject to receipt of Fundtech shareholder approval, which was obtained at a special meeting on Tuesday, and satisfaction of other conditions.

Fundtech is a provider of software services that facilitate payments processing, financial messaging and cash management for financial institutions.

BankServ is a Las Vegas-based software-as-a-service provider of financial services and banking technology that offers wire transfer, Swift messaging, remote deposit capture, mobile and online payment-processing technology.

The combined company, Fundtech Inc., would be based in Fundtech's existing U.S. headquarters in Jersey City, N.J.

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