American billionaire Michael Dell’s $7.7 billion Baldwin acquisition gets $2.3 billion loan backing

American billionaire Michael Dell’s planned acquisition of The Baldwin Group is moving into its financing phase, with Morgan Stanley launching $2.3 billion in loans to support the $7.7 billion take private transaction.

The financing, launched on Nov 3, comprises a $2 billion seven years term loan and a $300 million delayed term loan, The delayed draw facility allows the borrower to access the funds at a later date.

The package also includes $750 million in second lien secured debt being placed privately. Initial pricing discussions for the loans are around 3.5 percentage points above the floating benchmark rate, with the term loan offered at 99 cents on the dollar.

The financing will support the acquisition by DFO Management, the investment office that manages Dell’s family assets, and Sequence Holdings. The two investors entered into a definitive agreement on Sept 14 to acquire a majority interest in Baldwin in an all cash transaction.

The deal values Baldwin at approximately $7.7 billion, comprising an equity purchase price of about $4.6 billion and approximately $3.1 billion in net debt to be assumed or refinanced. Shareholders are set to receive $32.50 per share, representing an 88% premium to the company’s closing price on June 17, before reports of a possible takeover emerged.

Dell is participating through DFO Management, which manages the investment assets of the founder, chairman and chief executive of Dell Technologies and his family. Sequence is a permanent holding company focused on acquiring and developing established businesses in the service economy.

Under the agreement, the buyers will acquire a majority interest in Baldwin, while eligible employees will retain a significant minority stake in the privately held company.

Baldwin provides insurance brokerage, risk management, employee benefits and advisory services. Its trailing 12 months adjusted earnings before interest, taxes, depreciation and amortization stood at approximately $396 million when the transaction was announced.

The acquisition is expected to close in the first quarter of 2027, subject to regulatory approvals and other customary closing conditions. The merger agreement states that completion is not conditional on obtaining financing, meaning the newly launched loan package is not a financing condition for the transaction.