Research Update: NAVEX TopCo Inc. Assigned 'B-' Issuer Credit Rating On Acquisition By BC Partners Advisors L.P.; Outlook Stable

On July 10, 2018, NAVEX TopCo Inc., a provider of ethics and compliance (E&C) software and services, entered into a definitive agreement to be acquired by BC Partners Advisors L.P. (BC Partners) for approximately $1.4 billion. NAVEX will fund the transaction in part with a $564 million credit facility, consisting of $75 million first-lien revolver, a $410 million first-lien term loan, and a $154 million second-lien term loan. We are assigning a 'B-' issuer credit rating to NAVEX. The outlook is stable. We are also assigning our 'B-' issue-level and '3' recovery rating to the company's first-lien debt, and our 'CCC' issue-level and '6' recovery rating to its second-lien term loan. The stable outlook reflects our expectation that continued growth

...+ On July 10, 2018, NAVEX TopCo Inc., a provider of ethics and compliance (E&C) software and services, entered into a definitive agreement to be acquired by BC Partners Advisors L.P. (BC Partners) for approximately $1.4 billion. + NAVEX will fund the transaction in part with a $564 million credit facility, consisting of $75 million first-lien revolver, a $410 million first-lien term loan, and a $154 million second-lien term loan. + We are assigning a 'B-' issuer credit rating to NAVEX. The outlook is stable. + We are also assigning our 'B-' issue-level and '3' recovery rating to the company's first-lien debt, and our '###' issue-level and '6' recovery rating to its second-lien term loan. + The stable outlook reflects our expectation that continued growth in the E&C software market, increased penetration into the company's existing customer base, and a high degree of recurring revenue will enable NAVEX to continue to generate positive free cash flow and reduce leverage below 9x over the...

Research Update