An investor consortium led by Singapore's sovereign wealth fund GIC Pte. Ltd. and private investor Silver Lake Management LLC is planning to get a special dividend of more than $900 million from Ancestry.com, Bloomberg News reported.
The DNA analysis and family tree company is looking to issue a new $1.15 billion seven-year term loan and allocate close to $400 million of cash to finance its recapitalization, according to the report. The loan will also be used to make a distribution of about $910 million to shareholders and repay its debt of $600 million.
The company's owners, together with the consortium, are seeking creditor approval for additional one-time distribution of approximately $150 million at 2019-end before using the remainder to pay down debt, Bloomberg reported, citing Moody's.
The transaction will increase the company's total debt to around 5.5x a measure of earnings, according to Bloomberg, citing people familiar with the matter.
GIC and Silver Lake bought a majority interest in the company in 2016, while its former owners Permira and Spectrum Equity continue to own a minority stake in the business.
Representatives for Morgan Stanley, the lead arranger of the new term loan, and Silver Lake did not comment on the matter, while GIC did not answer requests for comment, according to the report. A representative for Ancestry.com said it does not comment on its capital structure.