Report: MoneyGram Fails to Secure Lower Borrowing Costs on Leveraged Loan

MoneyGram International reportedly failed to secure lower borrowing costs on a $398 million leveraged loan before a deadline on Thursday (May 23).

The company had aimed to convince lenders to cut the borrowing costs on the loan that helped finance Madison Dearborn Partners’ leveraged buyout of MoneyGram International in 2023, Bloomberg reported Friday (May 24), citing unnamed sources.

It’s not unusual for loan deadlines to be missed, and deals do happen after these target dates, the report said. However, this case happened during a week in which most transactions have gone smoothly, and the leveraged loan market had one of its busiest weeks of the year, per the report.

MoneyGram International did not immediately reply to PYMNTS’ request for comment.

The company received the final regulatory approval needed for its sale to venture capital firm Madison Dearborn Partners in May 2023, when the Reserve Bank of India gave its approval.

MoneyGram announced the planned acquisition — for $1.8 billion — in February 2022.

Alex Holmes, MoneyGram’s CEO and chairman, said at the time in a press release: “MoneyGram has undergone a rapid transformation over the last several years to expand our digital capabilities and adapt to the evolving needs of our customers. By partnering with MDP and becoming a private company, we will have greater opportunities to innovate and transform MoneyGram to lead the industry in cross-border payment technology and deliver a more expansive set of digital offerings, while leveraging our global platform for new customers and use cases.”

In one recent development, MoneyGram and Trustly said in March that they partnered to enable millions of MoneyGram users in Europe to make cardless international money transfers.

With the service enabled by this collaboration, users can pay directly from their bank accounts when sending international money transfers through MoneyGram Online (MGO).

In September, MoneyGram announced that it planned to launch a non-custodial digital wallet that will offer new ways to send and receive cross-border payments.

This wallet will allow users to seamlessly move from fiat currency to digital currency and back again, and marks another step forward in the company’s vision of connecting the world’s communities via financial solutions, MoneyGram said at the time.