GoDaddy Inc. Announces Refinancing of Tranche B-5 Term Loans

Rhea-AI Summary

GoDaddy Inc. (GDDY) allocates $1,752 million tranche of term loans to refinance outstanding loans. The transactions are anticipated to close in the first quarter of 2024, subject to conditions.

Positive

• None.

Negative

• There is uncertainty regarding the successful completion of the transactions, and it is not guaranteed that they will be completed on the terms described or at all.

Financial Analyst

The allocation of a $1,752 million tranche of term loans by GoDaddy represents a significant financial restructuring move, aimed at improving the company's debt profile by refinancing existing obligations. This refinancing could potentially lead to a reduction in interest expenses, thereby improving net income and cash flows. Stakeholders should monitor the interest rates associated with the new term loans in comparison to the old Tranche B-5 Term Loans to gauge the immediate financial impact.

Moreover, the maturity extension to 2029 provides GoDaddy with a longer timeframe to manage its liabilities, which could alleviate short-term liquidity pressures. However, it is important to consider the overall leverage of the company and the terms of the Credit Agreement to understand the long-term financial health and solvency risks. The success of this refinancing could signal to the market an improved credit standing of GoDaddy, potentially affecting its stock performance positively.

Market Research Analyst

GoDaddy's strategic decision to refinance its debt could be reflective of broader market conditions where companies are seeking to lock in favorable interest rates amidst a volatile rate environment. This move might also be indicative of GoDaddy's capital management strategy and its efforts to optimize its balance sheet for future growth or investment opportunities.

It is essential to analyze how this refinancing aligns with GoDaddy's operational strategy and whether it could free up resources for reinvestment into core business areas or new initiatives. Observing how competitors within the web hosting and domain registration industry respond to this action can provide insights into industry trends regarding debt management and financial strategies.

Legal Expert

The legal intricacies of the Term Loan Refinancing involve ensuring compliance with the conditions set forth in the Second Amended and Restated Credit Agreement. The successful completion of the transaction hinges on meeting these conditions, which likely include lender consents, regulatory approvals and the absence of any event that could materially impact GoDaddy's financial position.

It is crucial to assess the implications of any covenants or restrictions that may be associated with the new Replacement Term Loans. Such terms could affect GoDaddy's operational flexibility and strategic decision-making. Stakeholders should be apprised of any material changes to the terms of the Credit Agreement that could impact GoDaddy's obligations or the rights of the lenders.

TEMPE, Ariz., Jan. 10, 2024 /PRNewswire/ -- GoDaddy Inc. (NYSE: GDDY) today announced Go Daddy Operating Company, LLC and GD Finance Co, LLC (together with Go Daddy Operating Company, LLC, the "Borrowers") allocated a $1,752 million tranche (the "Replacement Term Loans") of term loans maturing in 2029, the proceeds of which will be used to refinance all outstanding Tranche B-5 Term Loans under the Second Amended and Restated Credit Agreement, dated as of February 15, 2017 (as amended, restated, supplemented or otherwise modified, refinanced or replaced from time to time, the "Credit Agreement"), by and among the Borrowers, Desert Newco, LLC, the lenders and the other parties thereto (such refinancing, the "Term Loan Refinancing"). Capitalized terms used herein, but not otherwise defined herein are as defined in the Credit Agreement.

The foregoing transactions are subject to conditions and are anticipated to close in the first quarter of 2024. However, there can be no assurance that the Borrowers will be able to successfully complete the transactions, on the terms described above, or at all.

About GoDaddy

GoDaddy helps millions of entrepreneurs globally start, grow, and scale their businesses. People come to GoDaddy to name their idea, build a professional website, attract customers, sell their products and services, and accept payments online and in-person. GoDaddy's easy-to-use tools help microbusiness owners manage everything in one place, and its expert guides are available to provide assistance 24/7. To learn more about the company, visit www.GoDaddy.com.

Forward-looking Statements

This news release may contain forward-looking statements, including, but not limited to, our financing plans and the details thereof, including the proposed use of proceeds therefrom, the expected timing of the Term Loan Refinancing with the Replacement Term Loans and the ability to close such transaction. Forward-looking statements may generally be identified by the use of the words "anticipates," "expects," "predicts," "goals," "intends," "plans," "should," "could," "would," "may," "will," "believes," "estimates," "potential," "target," "commit," "forecast," "tracking," or "continue" and variations or similar expressions, and phrases or statements that certain actions, events or results may, could, should or will be achieved, received or taken or will occur or result, and similar such expressions also identify forward-looking information. These forward-looking statements are based upon the current expectations and beliefs of management and are provided for the purpose of providing additional information about such expectations and beliefs and readers are cautioned that these statements may not be appropriate for other purposes. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results and events to differ materially from those described in these forward-looking statements. These risks and uncertainties include, but are not limited to, the risks and uncertainties discussed in GoDaddy Inc.'s (the "Company") most recent annual and quarterly reports and detailed from time to time in the Company's other filings with the U.S. Securities and Exchange Commission, which risks and uncertainties are incorporated herein by reference.

Readers are cautioned not to place undue reliance on any of these forward-looking statements. These forward-looking statements speak only as of the date hereof. The Company undertakes no obligation to update any of these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect actual outcomes, unless required by law.

Source: GoDaddy Inc.

© 2024 GoDaddy Inc. All Rights Reserved.

 

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SOURCE GoDaddy Inc.

What did GoDaddy Inc. (GDDY) announce?

GoDaddy Inc. announced the allocation of a $1,752 million tranche of term loans to refinance all outstanding Tranche B-5 Term Loans.

When are the transactions anticipated to close?

The transactions are anticipated to close in the first quarter of 2024, subject to conditions.

What is the purpose of the term loans allocated by GoDaddy Inc. (GDDY)?

The proceeds of the term loans will be used to refinance all outstanding Tranche B-5 Term Loans under the Second Amended and Restated Credit Agreement.

Is the successful completion of the transactions guaranteed?

There can be no assurance that the Borrowers will be able to successfully complete the transactions, on the terms described above, or at all.