Monitronics International, Inc. signed a definitive agreement to acquire Security Networks, LLC from a group of sellers for approximately $510 million.
For the year ended December 31, 2012, Security Networks reported total assets of $274.96 million, total common equity of $51.88 million, revenue of $78.48 million, EBIT of $19.49 million, adjusted EBITDA of $46.5 million and net income of $3.58 million. Post acquisition, the combined companies will be headquartered in Dallas, Texas and Mike Haislip will become Chief Executive Officer of combined entity.
The deal is subject to regulatory approvals, HSR Act approval, proceeds of the financing shall be available to Monitronics International, the Ascent shares shall have been accepted for listing and trading on the Stock Exchange, execution of non-competition and non-solicitation agreements and amended employment agreements and other customary closing conditions. The transaction is expected to close in mid-August 2013.
Monitronics International Inc., a subsidiary of Ascent Capital Group Inc arranged a total of $578.5 million in debt to wrap up its $508 million acquisition of Security Networks LLC from Oak Hill Capital Partners. The financing included a $225 million term loan B and an increase of its revolver by $75 million to total $225 million. The five-year term loan priced at L+325. Monitronics also issued $103.5 million of 4% seven-year convertible notes and added on $175 million of 9.125% notes due in April 2020 to pay for the acquisition.
Erica Bartsch of Sloane & Company acted as PR advisor to Ascent Capital Group and Jeremy Fielding of Kekst and Company acted as PR advisor to Oak Hill Capital Partners. Renee L. Wilm of Baker Botts L.L.P acted as legal advisor for Monitronics International. Angelo Bonvino of Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as legal advisor for Oak Hill Capital Partners, BNY Mellon-Alcentra Mezzanine Partners, Perry Companies and other sellers. Bank of America, N.A. acted as escrow agent in the transaction.