01—Abstract
Summary
Summary of the 8-K filed September 5, 2023. Cited figures are marked; the original filing is the authoritative source.
Intercontinental Exchange, Inc. (ICE) filed an 8-K report on September 5, 2023, announcing the completion of its merger with Black Knight, Inc. The filing provides details on the merger consideration, which includes a significant cash component and stock.
Preliminary election results indicate that the stock consideration was oversubscribed, leading to proration for those Black Knight stockholders who elected stock. Consequently, these stockholders will receive a mix of cash and ICE common stock. The total implied value of the merger consideration is approximately $11.9 billiona, with $10.5 billion in cash and approximately 10.9 million shares of ICE common stock.
ICE financed the cash portion of the merger and Black Knight's debt repayment through a combination of senior notes, a delayed draw term loan, commercial paper issuance, and existing cash. As part of regulatory requirements to gain approval for the acquisition, ICE has agreed to divest Black Knight's Optimal Blue and Empower loan origination system (LOS) businesses to Constellation Software Inc. within the next 20 days. The filing also details the treatment of Black Knight's equity awards and employee stock purchase plan.
02—Key points
Key Highlights
- Completion of the Black Knight merger by Intercontinental Exchange (ICE).
- Merger consideration valued at approximately $11.9 billion, comprising $10.5 billion in cash and approximately 10.9 million shares of ICE common stock.
- Preliminary results show oversubscription for the stock consideration, leading to proration for electing Black Knight stockholders.
- ICE funded the cash portion of the merger and debt repayment through senior notes, term loans, commercial paper, and cash on hand.
- ICE will divest Black Knight's Optimal Blue and Empower LOS businesses to Constellation Software Inc. to satisfy regulatory requirements.
- Treatment of Black Knight's restricted stock awards and RSUs, with some accelerated vesting and conversion into ICE stock.
- Black Knight's Employee Stock Purchase Plan (ESPP) terminated, with contributions used to purchase shares converted to merger consideration or distributed in cash.
03—Questions
Frequently Asked Questions
What is the main purpose of this 8-K filing?
This 8-K filing announces the completion of the merger between Intercontinental Exchange (ICE) and Black Knight, Inc. It provides details about the merger consideration, how it was funded, preliminary results of stockholder elections, and required divestitures.
What is the preliminary outcome for Black Knight stockholders who elected to receive ICE stock?
Preliminary results indicate that the stock portion of the merger consideration was oversubscribed. Therefore, Black Knight stockholders who elected to receive ICE common stock will be subject to proration and are expected to receive approximately 68% of their merger consideration in cash and 32% in ICE common stock.
How did ICE fund the cash component of the merger?
ICE funded the cash portion of the merger and the repayment of approximately $1.5 billion of Black Knight's debt through a combination of $4.9 billion from senior notes, $2.4 billion from a delayed draw term loan, $2.5 billion from the commercial paper market, and approximately $2.2 billion of existing cash on hand.
Are there any divestitures required as part of this acquisition?
Yes, to obtain regulatory clearance from the Federal Trade Commission, ICE has agreed to divest Black Knight's Optimal Blue and Empower loan origination system (LOS) businesses to subsidiaries of Constellation Software Inc. These divestitures are expected to be completed within the next 20 days.
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