September 16, 2019 / 10:47 AM / a month ago

ION Corporates turns to Credit Suisse for renewed refi attempt

LONDON (LPC) - Irish software firm ION Corporates has relaunched a jumbo leveraged loan refinancing via Credit Suisse after an original deal brought via house bank UBS was pulled in May having met opposition from loan investors, banking sources said.

FILE PHOTO: Switzerland's national flag flies beside a logo of Swiss bank Credit Suisse at its headquarters at the Paradeplatz square in Zurich, July 31, 2019. REUTERS/Arnd Wiegmann

The US$1.75bn refinancing for ION Corporates is a brand new mandate for Credit Suisse, which has restructured the original failed refinancing to make it more attractive to investors.

The new loan has reduced leverage, improved ratings and features less aggressive documentation, sources said.

“Given how challenging the last deal was for ION they were looking for a fresh set of eyes and this new deal has effectively been restructured to something more palatable all round,” a senior banker said.

The loan originally launched in April at US$2.21bn to back the refinancing and combination of three software businesses - Openlink, TriplePoint and Wall Street Systems - known collectively as ION Systems. The loan was also due to fund a US$250m dividend payment.

However, it abandoned plans in May to take a dividend, reducing the loan refinancing to US$1.96bn, before dropping the refinancing altogether later that month after it struggled to get investors support.

NEW DEAL

ION Corporates has now put in around US$200m of equity to reduce the loan to US$1.75bn, which along with Ebitda growth has lowered leverage to 4.25x from around 5.0x in the last refinancing attempt, sources said.

This has helped to improve corporate and issue ratings to B2/B with stable outlook, compared to B3/B- with negative outlook, in the last refinancing attempt.

Documentation has also been significantly altered so it is not as aggressive, sources said.

“A long time was spent on documentation to get it more in line with the market and what the market requires rather than the super aggressive terms in the last deal,” the senior banker said.

The six-year term loan will be denominated in dollars and euros and bank meetings are due to take place in New York on September 17 and London on September 19, when pricing will emerge.

The loan will be offered with a 0% floor and 101 soft-call for six months.

“It will be interesting to see how the loan is met by the market now. Perhaps there is renewed vigor and it will be a different story this time round,” a second senior banker said.

Separately, the parent firm ION Group tried to tap the loan market with US$1.0bn-$1.1bn debt financing this year to fund its£1.35bn acquisition of financial media and data firm Acuris from BC Partners in March.

It also failed to raise that debt package in the broadly-syndicated market and turned to the private debt market instead.

Editing by Alasdair Reilly

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