US-based wide area network (WAN) optimisation specialist Riverbed Technology is taking on US$525m in notes to help fund its sale to Thoma Bravo and the Ontario Teachers’ Pension Plan.
The 8.875% senior bond due 2023 was issued by Project Homestake…
US-based wide area network (WAN) optimisation specialist Riverbed Technology is taking on US$525m in notes to help fund its sale to Thoma Bravo and the Ontario Teachers’ Pension Plan.
The 8.875% senior bond due 2023 was issued by Project Homestake Merger Corp, which is controlled by private equity firm Thoma Bravo’s affiliates, and priced at par.
Riverbed had earlier announced plans for a US$575m bond due 2023.
The company said proceeds will be used with other financing sources to fund the US$3.6bn sale it announced back in December. It expects to complete the bond on 9 March 2015.
The sale requires regulatory and shareholder approvals, and the bond proceeds will be placed into escrow if it is not completed concurrently with the closing of the acquisition.
The group has funding commitments from Credit Suisse, Citigroup and Barclays for the deal.
Riverbed revealed it had launched a strategic review and a restructuring in October after declining sales in its core business. Activist hedge fund Elliott Management, which was its largest shareholder with a stake of around 10%, had been calling for a sale for nearly a year.
San Fransisco-based Riverbed provides a variety of satellite communication services and is predominantly focused on satellite WAN optimisation solutions.
It has hired Qatalyst Partners and Goldman Sachs for financial advice on the acquisition, and Wilson Sonsini Goodrich & Rosati, Professional Corporation is its legal adviser. Thoma Bravo hired Kirkland & Ellis for legal advice.
Sells SteelApp assets to Brocade
The bond comes shortly after Riverbed sold its SteelApp virtual application delivery controller product line last month for an undisclosed sum.
US-listed network solutions firm Brocade bought the SteelApp assets, which control traffic to and from applications including enterprise, cloud, and e-commerce, in an all-cash transaction.
Jerry Kennelly, Riverbed’s chairman, said: “The decision to divest the SteelApp product line reflects Riverbed’s ongoing commitment to focus on businesses and opportunities that leverage our core competencies.
“Riverbed is focused on providing solutions that provide CIOs unparalleled visibility, optimisation, and control in the hybrid enterprise, ensuring on-premises, cloud and SaaS applications perform as needed.”
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