Riverbed Technology cuts offering of eight-year notes to $525 million, upsizes loan

By Paul A. Harris

Portland, Ore., Feb. 25 – Riverbed Technology Inc. downsized its offering of eight-year senior notes (Caa1/CCC+) to $525 million from $575 million, shifting a further $50 million of proceeds to its first-lien term loan, a syndicate source said on Wednesday.

The shift of proceeds increases the loan size to $1,625,000,000 from $1,575,000,000.

The move announced on Wednesday represents the second downsizing of the bonds.

An earlier change in the structure of the financing saw the loan increase to $1,575,000,000 from $1,525,000,000, while the bond portion was reduced from the initially planned $625 million.

A roadshow for the bond deal is underway. The schedule has it being presented to investors in Boston on Wednesday and on the West Coast of the United States on Thursday.

The deal is expected to price Friday.

Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Barclays and Morgan Stanley & Co. LLC are the joint bookrunners for the Rule 144A and Regulation S offering.

The notes come with three years of call protection and feature a three-year 40% equity clawback and a 101% poison put.

The notes come with customary incurrence-based high-yield covenants.

Proceeds will be used to fund the leveraged buyout of Riverbed Technology by affiliates of Thoma Bravo and Teachers' Private Capital, the private investor department of Ontario Teachers' Pension Plan.

Riverbed is a San Francisco-based technology company that specializes in improving the performance of networks and networked applications.

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