Solera launches $300M incremental term loan; commitments due Feb. 8

Solera Holdings Inc. is in the market with a $300 million incremental first-lien term loan that will be used to support an acquisition, according to sources. The J.P. Morgan-led deal launched with a lender call this morning, and commitments are due by noon ET on Feb. 8.

The add-on is offered at an issue price in the range of 99-99.5 and will be fungible with the existing covenant-lite first-lien term loan due June 2028 that is priced at L+400 with a 0.5% Libor floor. At talk, the yield to maturity is 4.68%-4.77%.

Current first-lien facility ratings are B-/B2, with a 3 recovery rating from S&P Global Ratings. Corporate ratings are B-/B3, with stable outlooks.

Proceeds from the deal, combined with $338 million of equity and a $100 million revolver draw, will be used to acquire Spireon Inc. for $737.5 million, according to Moody's. On Feb. 1, Solera announced that it signed a definitive agreement to acquire Spireon from Greenbriar Equity Group for an undisclosed amount. Spireon provides GPS tracking devices with brands that include Lojack, GoldStar, and FleetLocate. Closing of the acquisition is expected in the first quarter.

Solera's existing term loans were placed in June 2021 to refinance debt and fund acquisitions. At issuance the financing comprised a $3.38 billion first-lien term loan, a €1.2 billion first-lien term loan due June 2028 (E+400, 0% floor), and a £300 million first-lien term loan due June 2028 (SONIA+525, 0% floor). All three tranches have a 25-basis-point margin step-down at 4.5x first-lien net leverage. Goldman Sachs is administrative agent.

As part of that transaction, the company placed a $2.5 billion multicurrency second-lien term loan due 2029 and put in place a $500 million super-priority revolver, Moody's noted.

Texas-based Solera, backed by Vista Equity Partners, provides risk and asset management software and services to the automotive and property industries.