Syniverse, a global technology provider of mission-critical mobile platforms for carriers and enterprises, completed the syndication of $1 billion in senior secured term loan commitments to refinance its capital structure, subject to customary conditions, including satisfactory definitive documentation. The financing will be used in connection with and contingent upon the company’s merger with M3-Brigade Acquisition II (MBAC), a special purpose acquisition company. The financing also includes a $165 million, five-year senior secured revolving credit facility.
Summary of key terms for the Term Loan:
- Secured overnight funding rate (SOFR) plus 4.25% (subject to a 50-basis point SOFR floor) with 1.00% original issue discount
- No credit spread adjustment (CSA) included
- Environmental, social & governance (ESG) metric-based step-down in the term loan interest rate margin of 7.5 basis points subject to meeting a specified target in the new credit agreement for the credit facilities
- 2029 final maturity with a standard 1.0% annual principal amortization and 101 soft call provision for six months from date of closing
- B2 rating from Moody’s investor service and B- rating from Standard & Poor’s on both the term loan and RCF
Syndication of the new term loans was approximately more than doubly oversubscribed with 48 investors in the final order book. As a result, the refinancing priced at the lower end of initial expectations.
“We are very pleased with the better-than-expected execution we realized on these credit facilities,” Simeon Irvine, CFO of Syniverse, said. “Our future shareholders stand to benefit from a substantial reduction in our interest rates and contingent on our proposed merger with MBAC, our gross debt will reduce by half.”
“The enhanced financial flexibility this refinancing provides will enable both continued deleveraging through improved free cash flow generation and heightened reinvestment in innovation to spur faster growth. We look forward to merging with MBAC, and as a public company, providing guidance on free cash flow for 2022 on our 1st quarter earnings call in April,” Irvine said.
Barclays Bank acts as joint lead arranger and joint bookrunner on the term loan, together with Goldman Sachs Bank, Mizuho Bank, BofA Securities, Credit Suisse Loan Funding, Deutsche Bank Securities, BNP Paribas Securities and Société Générale. Barclays Bank will also be the administrative agent.