Bright Horizons Family Solutions Inc. (BFAM), the provider of employer-sponsored child care controlled by Bain Capital Partners LLC, set the rate it will pay on an $815 million term loan to refinance debt, according to a person with knowledge of the transaction.
The debt will pay interest at 3.5 percentage points to 3.75 percentage points more than the London interbank offered rate, said the person, who asked not to be identified because the information is private. Libor, a rate banks say they can borrow in dollars from each other, will have a 1 percent floor.
Bright Horizons is proposing to sell the loan at 99 cents on the dollar, the person said, reducing proceeds for the company and boosting the yield to investors.
Lenders are being offered one-year soft-call protection of 101 cents, meaning the company would have to pay 1 cent more than face value to refinance the debt during the first year, the person said.
Goldman Sachs Group Inc. is arranging the financing for the Watertown, Massachusetts-based company. The deal also includes a $100 million revolving line of credit, according to data compiled by Bloomberg. Investors have until Jan. 23 to let the bank know whether they will participate in the deal, according to the person.
Bain Capital, the Boston-based private-equity firm, acquired Bright Horizons in 2008 for about $1.3 billion, the data show.
Bright Horizons is planning an initial public offering of 10.1 million shares with an issue price of $19 to $21 a share, according to a regulatory filing.
Ilene Hoffer Serpa, a spokeswoman for Bright Horizons, declined to comment.
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