“It fits our objective of providing creative financing solutions to businesses with strong management teams and we feel it will benefit Skillsoft as well as our investors.”
The borrower under the credit facility is Skillsoft Receivables Financing, a bankruptcy-remote Delaware limited liability company and a wholly-owned subsidiary of Skillsoft. The credit facility is non-recourse to Skillsoft and is not subject to any financial covenants.
The credit facility allows the company to borrow against its high-quality accounts receivable and provides incremental capital to the company in addition to its existing $100 million revolving credit facility. The availability under the credit facility depends on a borrowing base that will vary throughout the year depending on the quantity of eligible accounts receivable available resulting from the seasonality of the business.
At closing the company expects an initial draw amount of approximately $70 million under the accounts receivable credit facility.
“We are happy to be partnering with Skillsoft CEO Chuck Moran and his team on this important transaction,” said Stephen Ketchum, founder and managing partner of Sound Point. “It fits our objective of providing creative financing solutions to businesses with strong management teams and we feel it will benefit Skillsoft as well as our investors.” Ketchum added, “This is just another example of our successful partnership with Morgan Stanley and we look forward to working with them on other transactions.”
Skillsoft said it intends to use approximately $65 million of the proceeds of the facility to fund its investment in core, compliance and Vodeclic content. The remaining facility is available as further liquidity for the company subject to compliance with the borrowing base. The Company will also expand its salesforce to continue to drive top-line growth.
Rothschild acted as the exclusive financial advisor to Skillsoft and Simpson Thacher & Bartlett acted as legal counsel to Skillsoft. Linklaters advised Sound Point and Morgan Stanley Senior Funding.
Skillsoft is a pioneer in the fields of learning and talent management with a long history of innovation. Skillsoft provides cloud-based learning solutions for its customers worldwide, ranging from global enterprises, government, and education to mid-sized and small businesses.