Getty Images NYSE:GETY saw its merger-linked bond rebound after the company moved to terminate its planned acquisition of Shutterstock NYSE:SSTK. The 10.5% senior secured notes due in 2030, which were originally issued to help fund the deal, jumped 14 cents on the dollar to about 98 cents after Getty said it would redeem the debt. The move came after Getty declined to accept a UK Competition and Markets Authority condition tied to approval of the proposed merger.
The $628.4 million bond was issued in October, with proceeds kept in escrow while the transaction waited for regulatory approvals across regions. The bond paid its first coupon in May. The CMA had approved the merger in May, but only if Shutterstock sold its editorial business, a condition aimed at addressing concerns that the deal could reduce choices for UK media outlets.
Getty's board unanimously decided not to move forward with selling Shutterstock's editorial business under CMA supervision, leading the company to terminate the merger agreement. Getty's $300 million senior unsecured notes due in 2027, which were part of a merger-linked consent solicitation and exchange offer, are not being redeemed and were trading around 84 cents on Wednesday. This could keep investor attention on Getty's standalone debt profile after the Shutterstock deal fell apart.