Sixth Street Partners-backed Legends Hospitality is in talks with a group of private credit firms led by Ares Management Corp. and KKR & Co. to finance its potential acquisition of venue and events management company ASM Global, according to people with knowledge of the matter.
The lender group, which also includes Apollo Global Management Inc. and Oaktree Capital Management, is in discussions to provide a $1.85 billion financing package that would help pay for the takeover and refinance existing debt at Legends and ASM, said the people, who asked not to be named because they’re not authorized to speak publicly. Ares is administrative agent on the transaction, the people said.
The deal would include a $1.55 billion unitranche loan, a $100 million delayed-draw term loan and a $200 million revolver, according to the people. The unitranche — a structure that blends senior and subordinated debt into a single facility — is expected to pay interest of six percentage points over the Secured Overnight Financing Rate and would be issued at a discounted price of 97.5 cents on the dollar, they said.
Representatives for Sixth Street, Legends, ASM, Ares, KKR, Apollo, and Oaktree declined to comment. LevFin Insights first reported some details of the financing on Monday.
A potential acquisition would create a global juggernaut in the lucrative business of sports team and live venue management, which covers everything from new stadium planning and sponsorships to merchandise and food and beverage sales.
Legends counts the New York Yankees, the Dallas Cowboys and the Los Angeles Rams among its US clients. In Europe, it works with teams including Real Madrid, FC Barcelona, Liverpool FC, and Manchester City FC, according to its website. ASM Global operates a portfolio of over 350 venues around the world.
The deal marks the latest example of companies turning to the private debt markets to finance upcoming mergers and acquisitions. Thoma Bravo is mulling a roughly $1 billion debt deal to help pay for its planned acquisition of NextGen Healthcare Inc., while a group of lenders including Blue Owl Capital Inc. and Blackstone Inc. recently agreed to provide $2.7 billion for BradyIFS’s acquisition of competitor Envoy Solutions.
(Updates with more detail on lenders and structure starting in first paragraph.)
Author: Paula Seligson, Ryan Gould and Davide Scigliuzzo
