Summary
Moody's Corporation (MCO) announced a significant acquisition on May 15, 2017, entering into a Securities Purchase Agreement (SPA) to acquire the indirect parent company of Bureau van Dijk Electronic Publishing B.V. for an enterprise value of €3.0 billion (approximately $3.27 billion). Bureau van Dijk is a provider of business intelligence and company information products, a strategic expansion for Moody's into data analytics and analytics services. The acquisition is primarily funded by a combination of cash and debt. Moody's has secured a $1.5 billion 364-day bridge credit facility to partially finance the deal, with the intention to replace this facility with new term loans, senior unsecured notes, and commercial paper prior to closing. The remaining portion of the purchase price and the retirement of the Target's indebtedness will be funded by cash on hand. The transaction is subject to regulatory approval from the EU Commission.
Key Highlights
- 1Moody's enters into a definitive agreement to acquire Bureau van Dijk Electronic Publishing B.V. for €3.0 billion ($3.27 billion).
- 2The acquisition significantly expands Moody's presence in business intelligence and company information products.
- 3The purchase price includes €2.245 billion ($2.45 billion) in cash, with adjustments for a locked box period and the retirement of approximately €754 million ($822 million) of the Target's debt.
- 4Moody's has arranged a $1.5 billion 364-day bridge credit facility to partially fund the acquisition.
- 5The company intends to refinance the bridge facility with longer-term debt instruments like term loans and senior unsecured notes.
- 6The transaction is contingent on receiving merger control clearance from the EU Commission.
- 7The economic risk of the target business shifts to Moody's as of December 31, 2016, under the 'locked box' arrangement.