Citrix talks $4 billion 6.5-year secured notes to yield 9½%-9¾%; pricing set for Tuesday

By Paul A. Harris

Portland, Ore., Sept. 19 – Citrix Systems Inc. talked its $4 billion offering of 6.5-year senior secured notes to yield 9½% to 9¾%, implying a discount range of 85.695 to 84.62, according to market sources.

Books are set to close at 5 p.m. ET on Monday, and the bonds – backing the buyout of Citrix by Vista Equity Partners and Evergreen Coast Capital – are set to price Tuesday morning.

The deal is in the market via issuing entity Picard Midco, Inc.

Initial talk had the Picard/Citrix notes coming with a 6½% coupon at a discount of 88 to 90 to yield in the high-8% to 9% area, according to market sources.

In addition to official price talk came details about covenant changes which primarily bear upon how the company may disburse cash and incur additional debt, sources say.

Credit Suisse Securities (USA) LLC is the left bookrunner.

BofA Securities Inc., Goldman Sachs & Co. LLC, Barclays, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., KKR Capital Markets LLC, Mizuho Securities USA Inc., Morgan Stanley & Co. LLC, RBC Capital Markets LLC, Apollo Global Securities LLC, Jefferies LLC, BMO Capital Markets Corp., BNP Paribas Securities Corp., Guggenheim, HSBC Securities (USA) Inc., Macquarie Capital (USA) Inc., Nomura Securities International Inc., Truist Securities Inc., UBS Securities LLC, Wells Fargo Securities LLC, KeyBanc Capital Markets Inc., MUFG, Scotia Capital (USA) Inc., SG Americas Securities LLC, Stifel Nicolaus & Co. Inc., SPC, TD Securities (USA) LLC, Fifth Third Securities Inc., ING Financial Markets LLC, IMI, Natixis Securities Americas LLC, Santander Investment Securities Inc. and U.S. Bancorp Investments Inc. are the joint bookrunners.

The notes become callable after three years at par plus 50% of the coupon. They feature a three-year 40% equity clawback and a 101% poison put.

The notes offering was upsized to $4 billion from $3.5 billion (initially $3 billion) with the shift of proceeds to the notes from the term loan A, reducing the loan to $2.5 billion from $3 billion (initially $3.5 billion).

As previously reported, the company is also getting a $4.05 billion term loan B, a $500 million equivalent euro-denominated term loan B and a $1 billion five-year revolver.

Proceeds plus preferred stock and equity will be used to fund the buyout, as well as the merger of Citrix with Tibco Software Inc., a Vista portfolio company, also to repay substantially all of Citrix’s and Tibco’s debt and for general corporate purposes.

Citrix, based in Fort Lauderdale, Fla., and Tibco, based in Palo Alto, Calif., are business enterprise technology companies.

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