MDC Partners Completes $775M Financing at a 5.5% Blended Cost of Capital

MDC Partners

today announced that it completed a $775 million refinancing of its balance sheet by closing on the issuance of $550 million of Senior Notes due 2020, and a new Revolving Bank Facility by increasing its size to $225 million and with a 5 year maturity to March 2018. The proceeds of the notes were used to redeem MDC's $425 million Senior Notes due 2016 and for general corporate purposes. The Senior Notes due 2020 were priced at 6.75%, a reduction of 525 basis points from the rate of the prior Senior Notes issued in 2009. In addition, the Revolving Bank Facility at LIBOR +200 basis points carries a 50 basis point reduction in the spread over LIBOR from MDC's prior revolver. The blended cost of capital of MDC's debt is now 5.5%, in aggregate. "Our strong financial performance over the last number of years has created the opportunity to lock in favorable rates and to extend maturities, significantly improving our balance sheet and allowing for an enhanced capital structure that affords us superior operating flexibility at a much lower cost as our business continues to grow and scale globally," said Miles S. Nadal, Chairman and Chief Executive Officer of MDC Partners. "We are very pleased with the execution of this transaction which brought in approximately 150 of the very finest bond investors, and along with the support of our bank syndicate, has provided MDC Partners with long-term financing on a very attractive basis." "The 525 basis point interest rate reduction is a testament to the operational focus and financial discipline we have employed across our organization," said David Doft, Chief Financial Officer. "The interest savings from the refinancing is expected to enhance our ability to generate free cash flow and positions us nicely to continue to improve our leverage toward our optimum target of below 2.5x." The Senior Notes offering was led by Bookrunners J.P. Morgan and Goldman, Sachs & Co. Senior Co-Managers included Wells Fargo Securities and BMO Capital Markets and Co-Manager was Deutsche Bank Securities. The Revolving Bank Facility was led by Wells Fargo Bank. About MDC Partners Inc. MDC Partners is one of the world's largest Business Transformation Organizations that utilizes technology, marketing communications, data analytics, insights and strategic consulting solutions to drive meaningful returns on Marketing and Communications Investments for multinational clients in the United States, Canada, and worldwide. MDC Partners' durable competitive advantage is to Empower the Most Talented Entrepreneurial Thought Leaders to Drive Business Success to new levels of Achievement, for both our Clients and our Shareholders, reinforcing MDC Partners' reputation as "The Place Where Great Talent Lives." MDC Partners' Class A shares are publicly traded on NASDAQ under the symbol "MDCA" and on the Toronto Stock Exchange under the symbol "MDZ.A".