Forrester to get $200 million debt financing for SiriusDecisions buy

By Sarah Lizee

Olympia, Wash., Nov. 27 – Forrester Research entered into a commitment letter on Monday with JPMorgan Chase Bank, NA and a syndicate of other lenders providing for $125 million senior secured five-year term loan facility and a $75 million five-year senior secured revolving credit facility, according to an 8-K filing with the Securities and Exchange Commission.

The company plans to use up to $175 million of the fully committed debt financing to help fund its planned acquisition of SiriusDecisions for $245 million. No more than $50 million of revolving loans may be made on the closing date.

The borrower may add one or more incremental term loan A facilities and/or increase commitments under the revolver in a total amount of up to $50 million.

Interest is expected to be Libor plus an initial spread of 250 basis points. The spread will range from 175 bps to 250 bps based on a leveraged-based pricing grid. There is an initial 35 bps commitment fee, which will range from 25 bps to 35 bps, also based on leverage.

The company must maintain a maximum total leverage ratio of 4 to 1, with 25 bps step-downs each quarter.

A minimum fixed-charge coverage ratio of 1.25 to 1 is also required under the agreement.

Forrester will also use cash on hand for the acquisition.

The transaction is expected to close in January and is subject to customary closing conditions.

Forrester Research is a research and advisory firm based in Cambridge, Mass. SiriusDecisions is a Wilton, Conn.-based company that provides advisory, consulting and learning services to help executives improve the performance of their sales, marketing and product strategies.

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