Tripadvisor Announces Close on Term Loan B Facility

Rhea-AI Summary

Tripadvisor (NASDAQ: TRIP) has successfully closed a $350 million tack-on term loan B facility through a Second Amendment to its Credit Agreement from June 26, 2015. The facility, maturing in 2031, carries an interest rate of SOFR plus 2.75%.

The company plans to utilize these proceeds to fund the repurchase, repayment, or redemption of its outstanding 0.25% Convertible Senior Notes due 2026 at a future date.

Positive

• Successful securing of $350 million in additional financing
• Long-term debt maturity until 2031 provides financial flexibility
• Strategic refinancing of convertible notes with potentially more favorable terms

Negative

• Additional debt burden increases financial obligations
• Higher interest rate exposure compared to existing 0.25% convertible notes

Insights

Financial Analyst

Tripadvisor's $350 million tack-on term loan B facility represents a strategic debt restructuring move that warrants investor attention. This facility, maturing in 2031 with an interest rate of SOFR plus 2.75%, will be used to address the company's 0.25% Convertible Senior Notes due 2026.

The transaction carries important financial implications. While the company is taking on higher-interest debt compared to the existing convertible notes (2.75% plus SOFR vs. 0.25%), the key benefit lies in potential equity dilution prevention. By replacing convertible notes, which could be converted to common stock, with standard term debt, Tripadvisor is protecting existing shareholders from potential ownership dilution.

The $350 million facility also gives management flexibility in timing the repurchase, repayment, or redemption of the 2026 notes, allowing them to optimize execution. With $2.03 billion market capitalization, this debt transaction represents a significant financial commitment relative to the company's size.

From a debt structure perspective, while this increases Tripadvisor's interest burden in the near term, it demonstrates the company has access to capital markets and can secure long-term financing. The successful closing indicates lender confidence in Tripadvisor's fundamentals despite operating in the highly competitive travel sector.

NEEDHAM, Mass., March 20, 2025 /PRNewswire/ -- Tripadvisor, Inc. (NASDAQ: TRIP) announced today that it has successfully closed a tack-on term loan B facility in the amount of $350.0 million pursuant to a Second Amendment to its Credit Agreement, dated as of June 26, 2015, as amended and restated. The Second Amendment provides for a $350 million upsize to the Company's term loan B credit facility maturing in 2031, with an interest rate based on SOFR plus 2.75%. The Company intends to use the proceeds of the new facility to fund the repurchase, repayment or redemption of the Company's outstanding 0.25% Convertible Senior Notes due 2026 at a later date.

Safe Harbor Statement

Statements in this press release regarding management's future expectations, beliefs, intentions, goals, strategies, plans or prospects, including, without limitation, statements relating to Tripadvisor's future financial performance on both a GAAP and non-GAAP basis, and Tripadvisor's prospects as a comprehensive destination for hotels, experiences, and restaurants, may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Forward-looking statements can be identified by terminology such as "anticipate," "believe," "could," "estimate," "expect," "intend," "is planned," "may," "should," "will," "would" or similar terms, variations of such terms or the negative of those terms. Investors are cautioned that statements in this press release, which are not strictly historical statements, including, without limitation, statements by our executive officers with respect to growth objectives, the expected timing for completion of the Merger and whether the Merger will close at all, strategic investments, our ability to realize the expected benefits of the reorganization, and statements regarding management's plans, objectives and strategies, constitute forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors including, but not limited to, those risks, uncertainties and factors detailed in Tripadvisor's filings with the SEC. As a result of such risks, uncertainties and factors, Tripadvisor's actual results may differ materially from any future results, performance or achievements discussed in or implied by the forward-looking statements contained herein. Tripadvisor is providing the information in this press release as of this date and assumes no obligations to update the information included in this press release or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

About Tripadvisor, Inc.

The Tripadvisor Group connects people to experiences worth sharing, and aims to be the world's most trusted source for travel and experiences. We leverage our brands, technology, and capabilities to connect our global audience with partners through rich content, travel guidance, and two-sided marketplaces for experiences, accommodations, restaurants, and other travel categories. The subsidiaries of Tripadvisor, Inc. (Nasdaq: TRIP), include a portfolio of travel brands and businesses, including Tripadvisor, Viator, and TheFork.

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SOURCE Tripadvisor

FAQ

What is the size and terms of Tripadvisor's (TRIP) new term loan B facility?

Tripadvisor's new term loan B facility is $350 million, maturing in 2031, with an interest rate of SOFR plus 2.75%.

How will Tripadvisor (TRIP) use the proceeds from the 2025 term loan?

The proceeds will be used to fund the repurchase, repayment, or redemption of the company's 0.25% Convertible Senior Notes due 2026.

When do Tripadvisor's (TRIP) convertible senior notes mature?

Tripadvisor's 0.25% Convertible Senior Notes are due in 2026.

What is the interest rate on Tripadvisor's (TRIP) 2025 term loan facility?

The interest rate is based on SOFR plus 2.75%.