Blackstone and Ares Back $3.6 Billion Loan for Warburg Pincus' Park Place Acquisition

Blackstone and Ares Management are providing a $3.6 billion loan for Warburg Pincus' acquisition of Park Place. The loan is part of a larger financing package for the deal, which is reportedly one of the largest private equity transactions in the US this year. The acquisition is expected to be completed in the coming weeks.

Lenders Blackstone Inc. and Ares Management Corp. have agreed to provide approximately $3.6 billion in private debt to finance Warburg Pincus' acquisition of Park Place Technologies. The deal, one of the largest private equity transactions in the U.S. this year, is expected to be completed in the coming weeks.

The financing package includes a $2.9 billion unitranche loan, a $300 million delayed-draw term loan, and a $400 million revolving credit facility. The deal is priced at 4.5 percentage points over the U.S. benchmark rate Blackstone, Ares Provide $3.6 Billion for Park Place Buyout^[3]. Ares serves as the administrative agent on the deal, while Blackstone was a significant lender in Park Place's previous debt transactions.

Warburg Pincus plans to merge Park Place, a data center services firm, with its existing portfolio company Service Express. The combined entity will be known as Park Place Technologies and will maintain its headquarters in Cleveland. Temasek took a significant minority investment as part of the acquisition.

This acquisition comes amidst a backdrop of increased scrutiny on private equity healthcare deals. California lawmakers have approved a bill, AB 1415, which requires private-equity and hedge-fund investors to notify the state's Office of Health Care Affordability of planned mergers or acquisitions of healthcare entities California Bill Would Put Private-Equity Healthcare Deals Under Scrutiny^[2]. This bill aims to provide more transparency and oversight in private-equity healthcare transactions.

The acquisition of Park Place by Warburg Pincus is part of a broader trend of increased activity in the private credit market. As merger and acquisition volume has picked up, lenders have been competing for deals, leading to more favorable terms for borrowers Blackstone, Ares Provide $3.6 Billion for Park Place Buyout^[3].