Bank of America is in the market with a $455 million credit facility to back RiskMetrics' acquisition of Institutional Shareholder Services. The deal consists of a six-year, $25 million revolver; a seven-year, $300 million first-lien term loan and a seven-and-a-half-year, $130 million second-lien term loan. Pricing could not be determined.
RiskMetrics announced Nov. 1 it would acquire ISS for approximately $527 million in a transaction set to close in January. The company is expected to use $430 million of debt financing, as well as $80 million of cash on hand and $60 million of rollover equity to fund the acquisition, according to a Moody's Investors Service release.
Both the first and second liens are secured by substantially all of the company's domestic assets and 65% of the stock of its foreign subsidiaries. Moody's rated the first lien Ba3 and the second lien B3, commenting that the acquisition combines two businesses with strong growth potential, increases business line diversification and offers the opportunity to cross-sell products across a similar client base. Standard & Poor's rated the first lien B+ with a 1 recovery rating and the second lien CCC+ with a 4 recovery rating.
Headquartered in New York, RiskMetrics provides research, analytics, data and other products and services to the financial community. ISS is based in Rockville, Md., and is a provider of corporate governance and proxy voting solutions. Calls to spokesmen for RiskMetrics and ISS were not returned.