Audatex/Solera to price $850 million two-part note offering Monday

By Paul Deckelman

New York, July 13 – Audatex North America Inc. will price $850 million of new senior unsecured notes later Monday, high-yield syndicate sources said.

The Rule 144A and Regulation S for life offering will come to market via bookrunning manager Goldman Sachs & Co.

The notes are being marketed to potential investors via an 11 a.m. ET conference call, as well as Netroadshow, with pricing expected sometime thereafter.

The offering will consist of a tranche of new notes due 2025, carrying five years of call protection, and an add-on to the company’s existing $565 million of 6 1/8% notes due Nov. 1, 2023, which will first be callable on Nov. 1, 2018.

Tranche sizes have not been set yet.

Audatex – a wholly owned subsidiary of Solera Holdings, Inc., a Westlake, Texas-based provider of software and services to the automobile insurance claims processing industry – originally sold $340 million of the 6 1/8% notes in 2013, pricing them at par in a quick-to-market transaction on Oct. 27 of that year, along with a $510 million add-on to its existing 6% senior notes due June 15, 2021.

The company priced another $225 million of the 6 1/8% notes, along with another $175 million of the 6% 2021 notes, in a second quick-to-market transaction on Nov. 12, 2014, with those 2023 notes pricing at 104.5 to yield 5.48%.

The company expects to generate net proceeds from the new deal of about $845.6 million after discounts, commissions and expenses. It plans to use $594.4 million of the proceeds to complete the purchase of the equity interests in its Service Repair Solutions joint venture from its joint venture partner, and will use $200 million of the proceeds to repay all of its outstanding borrowings under the senior unsecured interim credit facility that it entered into in connection with its acquisition of DMEautomotive, LLC on June 2, 2015 and pay related fees and expenses.

The company intends to use any remaining net proceeds for general corporate purposes, including continuing to actively seek, evaluate and potentially pursue strategic initiatives. Such strategic initiatives may include future acquisitions, joint ventures, investments or other business development opportunities.

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