Rocket Software to Pay $260 Mln Dividend to Court Square, Management

Are the good times back for private equity?

They apparently are for Court Square Capital Partners. Rocket Software is issuing a three part loan, totaling $430 million, that it will use to refinance existing debt and pay a $260 million dividend to shareholders, according to Moody’s Investors Service.

The payout comes more than two years after Court Square invested in the IT management software provider.

Rocket Software, of Newton, Mass., was founded in 1990 and initially provided software to IBM mainframe customers, according to In 2009, Court Square bought $92 million in Rocket Software stock. Rocket’s management is also an investor.

Moody’s, on Monday, assigned a “B2” corporate family rating to Rocket Software because of the company’s small size relative to its infrastructure peers, its acquisition appetite and aggressive financial policies. Rocket Software generates approximately $230 million in revenues, pro forma for recent acquisitions, Moody’s said. Rocket Software’s ratings outlook is stable.

“The company has modest organic growth prospects and the company looks to strategic acquisitions for growth and improved market position,” Moody’s said.

Closing leverage will be moderate at closing, just under 4X debt to EBITDA on Moody’s adjusted basis pro forma.

Court Square Capital was formed in 2006 by former members of Citigroup Venture Capital Equity Partners, including Bill Comfort. Calls to Court Square and Rocket Software were not immediately returned.