LONDON: Silver Lake on Tuesday raised a €1 billion (US$1.10 billion) seven-year loan to fund its takeover of Germany’s Software AG, breathing new life into the sluggish syndicated leveraged loan market.
The loan is split between €640 million and US$405 million, paying a margin of 475 basis points (bps) over the benchmark rate, according to a term sheet seen by Reuters.
Banks including JPMorgan, Citigroup and Banco Santander originally marketed the loan at a margin of 500 bps, before tightening it to 475 bps during the syndication process.
The loan was also sold to investors at a price of 98.75 cents on the euro/dollar, implying a smaller discount than the initial 97 cents on offer when the deal was launched on Jul 17.
On Jul 20, the US private equity firm announced it had secured a 84.29 per cent stake in Software AG, subject to closing of the tender offer, adding that the transaction was expected to close in the fourth quarter pending regulatory approvals.
Software AG shares were last up 0.3 per cent on the day in Frankfurt. They have fallen by 13 per cent since hitting a multi-month high after Silver Lake’s offer in April this year.
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