Press Ganey launches $35 million incremental term loan at 99½ OID

By Sara Rosenberg

New York, April 29 - Press Ganey Associates Inc. (PGA Holdings Inc.) launched on Tuesday its $35 million incremental first-lien term loan due April 20, 2018 with original issue discount talk of 991/2, according to a market source.

Pricing on the incremental loan, as well as on the company's existing roughly $376.7 million first-lien term loan due April 20, 2018, is Libor plus 325 basis points with a 1% Libor floor.

Barclays is the bookrunner on the deal.

Proceeds from the incremental loan and cash on hand will be used to repay the company's existing $45 million second-lien term loan.

In addition, the company is seeking an amendment to its existing credit facility to allow for the second-lien term loan repayment, waive the incremental debt incurred in this transaction so it does not hit the incremental basket, and increase the basket for non-recurring items in the definition of consolidated EBITDA to 15% of consolidated EBITDA, the source added.

Lenders are being offered a 10 bps consent fee.

Commitments and consents are due on May 6.

First-lien and total leverage is 4.3 times, and net leverage is 4.2 times.

Press Ganey is a South Bend, Ind.-based provider of health-care performance improvement services.

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