Lawson Software has launched a $1.15 billion cross-border offering of unsecured notes via joint bookrunners Bank of America Merrill Lynch (B&D), Credit Suisse, J.P. Morgan, Morgan Stanley, Barcap, Deutsche Bank, RBC, and KKR, according to sources. The bond is part of a jumbo financing for Golden Gate Capital’s proposed merger of Infor and Lawson. The new senior secured credit facility comprises a $150 million revolver and $3.5 billion of term loans, according to sources.
The expected ratings for the seven-year (non-call three) deal are B-/Caa1, according to the banks. The sizes of the dollar- and euro-denominated tranches are yet to be determined.
There will be an investor call on Monday at 2:00 p.m. EDT, followed by a European roadshow from March 19-20, and a U.S. roadshow starting on March 22. Pricing is expected for the week of March 26, sources said.
Together with borrowings under its new senior secured credit facility, the proceeds from the current bond offering will be used to refinance debt, finance the change of control notice, and fund its offer to purchase the outstanding 11.5% unsecured notes due 2018 at 101.
On March 8, Lawson Software issued a change of control notice, whereby holders of its 11.5% notes due 2018 are given the option of waiving the change-of-control provision in exchange for a 37.5 bps consent payment, and thereby remain invested in the new combined entity, or relinquish paper at the typical 101 put price. In a statement, Lawson disclosed that Infor and Lawson will merge into a new Cayman Islands exempted-company, named ComboCo. BAML is the solicitation agent for the consent solicitation process.
As reported, Golden Gate acquired Lawson Software in July, in a $2 billion deal, merging Lawson with SoftBrands, a business it previously owned. At the time, Infor made an investment in Lawson, and the two companies now operate under a shared service agreement.
In connection with that transaction, the company placed the $560 million issue of 11.5% senior notes due 2018, which priced at 92.143, to yield 13.25%, as well as a $1.115 billion senior-secured loan package, split between a $1.04 billion term loan and a $75 million revolving credit. The term loan cleared the market at L+525, with a 1.5% LIBOR floor. It was issued at 96.
Credit Suisse, Bank of America Merrill Lynch, Morgan Stanley, Royal Bank of Canada and Deutsche Bank arranged the loan. The same group acted as joint bookrunners on the bonds, with BAML as left lead. (For more details, see Lawson/SoftBrands: Deal Postmortem).
J.P. Morgan is administrative agent on Infor’s existing loans.
Lawson is rated B/B2, while Infor is rated B-/Caa1.
Lawson, an Infor affiliate, has more than 4,500 customers worldwide, primarily in specific services, trade and manufacturing/distribution industries. – Staff reports