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KKR Leads 20+ Lender Group to Raise Multibillion-Dollar Unitranche for Flexera Refi

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KKR is serving as lead arranger on a $2.85 billion debt financing package to support a refinancing effort for Thoma Bravo-backed IT management software provider Flexera, according to sources.

A group of more than 20 lenders are also participating in Flexera’s deal, said sources, including Blackstone, Blue Owl, Ares, Oak Hill Advisors, HPS Investment Partners, Golub Capital and Thoma Bravo Credit Fund.

The refinancing process is in late stages and poised to near the finish line soon, sources noted. The private loan will be used to refinance Flexera’s $1.95 billion 2028 term loan, according to previous Octus reporting. The sponsor is looking to withdraw a dividend of about $750 million. The debt package also includes a $150 million revolver, said sources.

Pricing for the new financing could be around SOFR+475 bps, according to Octus. The company generated $328 million adjusted EBITDA for the 12 months ended March 31, according to previous reporting.

Thoma Bravo reacquired Itasca, Il.-based Flexera for its second time in 2020 for $2.85 billion.

Software-focused private equity firm Thoma Bravo is not new to a large group of private lenders, which allows the firm to secure more aggressive terms.

Just recently, a syndicate of 10 private lenders provided up to $4 billion in debt financing to support Thoma Bravo’s leveraged buyout of Boeing’s Jeppesen navigation unit, Octus reported. Pricing on the debt financing was SOFR+475 bps. In 2019, the private equity firm raised around $2.5 billion from 19 direct lenders to fund the take-private of Coupa Software.

Pricing on senior direct lending facilities to support refinancings in the broader information technology sector has declined to SOFR+490 bps in the second quarter of the year, according to Octus’ Private Credit dashboard. Same pricing was SOFR+546 bps in the first quarter.

Thoma Bravo, Oak Hill Advisors, Ares and Blackstone declined to comment. KKR, Blue Owl, HPS Investment Partners, Golub Capital and Flexera did not return requests for comment.

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