Open Text talks restructured $600 million eight-year notes to yield 5½%-5¾%; pricing Monday

By Paul A. Harris

Portland, Ore., Jan. 9 – Open Text Corp. talked a restructured $600 million offering of eight-year senior notes (Ba2/BB) to yield 5½% to 5¾%, according to a market source.

The tenor of the notes was decreased to eight years from 10 years.

Call protection was decreased to three years from five years. The first call premium was increased to 75% of the coupon from 50%; the notes become callable after three years at par plus 75% of the coupon.

Books close at 10:30 a.m. ET on Monday, and the deal is set to price thereafter.

Joint bookrunner Barclays will bill and deliver for the Rule 144A and Regulation S for life notes sale. Morgan Stanley & Co., RBC Capital Markets and Citigroup Global Markets are also joint bookrunners.

The 10-year notes come with investment-grade covenants and feature a three-year 40% equity clawback at par plus the coupon.

The Waterloo, Ont.-based provider of enterprise information management software plans to use the proceeds to repay its existing term loan A and for general corporate purposes, including near-term acquisitions.

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