Advisory Board outlines expected pricing on $775 million facility

By Sara Rosenberg

New York, Dec. 11 – The Advisory Board Co. revealed in an 8-K filed with the Securities and Exchange Commission on Thursday expected pricing on its $775 million senior secured credit facility.

The $50 million five-year revolver is anticipated at Libor plus 350 basis points, and the $725 million seven-year covenant-light term loan is expected at Libor plus 400 bps.

Included in the term loan is 101 soft call protection for one year and amortization of 1% per annum.

The revolver has a maximum first-lien leverage covenant.

J.P. Morgan and Bank of America Merrill Lynch are leading the deal.

Proceeds will be used to help fund the acquisition of Royall & Co. and replace an existing $150 million revolver.

Under the agreement, Royall is being bought for $850 million, consisting of $750 million in cash and $100 million in Advisory Board stock.

Other funds for the transaction will come from about $65 million of cash on hand.

For the 12 months ended Sept. 30, adjusted EBITDA for the combined pro-forma entity was around $143 million.

Leverage is expected to be about 4.9 times debt to last 12 month adjusted EBITDA.

Closing is targeted for January, subject to clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and other customary conditions.

Advisory Board is a Washington, D.C.-based technology, research and services provider. Royall is a Richmond, Va.-based data-driven student engagement and enrollment management solutions company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.