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Software AG cuts spread on €1 billion equivalent U.S. and euro loan
By Sara Rosenberg
New York, July 31 – Software AG (Mosel Bidco SE) reduced pricing on its €1 billion equivalent seven-year U.S. and euro term loan (B2/B/BB-) to SOFR/Euribor plus 475 basis points from SOFR/Euribor plus 500 bps and tightened the original issue discount to 98 from 97, according to a market source.
In addition, a 25 bps pricing step-down at 2.5x senior secured net leverage was removed from the euro term loan, and the margin ratchet holiday was modified to six months from three months, the source said.
Also, ticking fees were changed to half the margin for days 46 to 90 and the full margin thereafter, from half the margin on days 121 to 180 and the full margin thereafter, and some revisions were made to documentation.
As before, the U.S. term loan has a minimum size of $400 million, a 25 bps step-down at 3.5x senior secured net leverage and a 0.5% floor, the euro term loan has 25 bps step-downs at 3.5x and 3x senior secured net leverage and a 0% floor, and both loans have 101 soft call protection for six months.
JPMorgan Chase Bank is the sole physical bookrunner on the deal. Banco Santander and Citigroup Global Markets Inc. are joint bookrunners.
Recommitments for the U.S. term loan were scheduled to be due at the end of the day on Monday, and recommitments for the euro term loan are due at 7 a.m. ET on Tuesday, the source added.
Proceeds will be used to help fund the buyout of the company by Silver Lake for €32.00 per share, implying an equity value of Software AG of about €2.4 billion.
Closing is expected in the fourth quarter.
Software AG is a Darmstadt, Germany-based software company.
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