Debt Disclosure | Debt Debt outstanding consisted of the following: (in millions) June 30, 2023 December 31, 2022 Senior Secured Term Loan B-6, payable in quarterly installments through December 1, 2028, with periodic variable interest (7.47% 1 at June 30, 2023 and 6.63% 2 at December 31, 2022), net of original issue discount and deferred financing fees of $4.6 million and $26.0 million, respectively, at June 30, 2023, and original issue discount and deferred financing fees of $5.3 million and $29.9 million, respectively, at December 31, 2022 $ 2,272.9 $ 2,433.7 Senior Secured Term Loan B-5, payable in quarterly installments through November 15, 2026, with periodic variable interest (6.95% 1 at June 30, 2023 and 6.13% 2 at December 31, 2022), net of original issue discount and deferred financing fees of $2.2 million and $5.4 million, respectively, at June 30, 2023, and original issue discount and deferred financing fees of $2.5 million and $6.2 million, respectively, at December 31, 2022 2,191.3 2,203.3 Senior Secured Term Loan A-3, payable in quarterly installments through December 10, 2024, with periodic variable interest (6.70% 1 at June 30, 2023 and 6.13% 2 at December 31, 2022), net of original issue discount and deferred financing fees of $0.9 million and $0.6 million, respectively, at June 30, 2023, and original issue discount and deferred financing fees of $1.3 million and $0.8 million, respectively, at December 31, 2022 1,004.7 1,033.0 Finance leases 0.1 0.1 Senior Secured Revolving Credit Facility — — Total debt 5,469.1 5,670.1 Less short-term debt and current portion of long-term debt (114.6) (114.6) Total long-term debt $ 5,354.5 $ 5,555.5 1. Periodic variable interest at Term SOFR, plus a credit spread adjustment, or alternate base rate, plus applicable margin. 2. Periodic variable interest at LIBOR or alternate base rate, plus applicable margin. Senior Secured Credit Facility On June 15, 2010, we entered into a Senior Secured Credit Facility with various lenders. This facility has been amended several times and currently consists of the Senior Secured Term Loan B-6, Senior Secured Term Loan B-5, Senior Secured Term Loan A-3 (collectively, the “Senior Secured Term Loans”), and the Senior Secured Revolving Credit Facility. On December 1, 2021, we entered into an agreement to amend certain provisions of the Senior Secured Credit Facility and exercise our right to draw additional debt in an amount of $3,100.0 million, less original issue discount and deferred financing fees of $7.8 million and $43.6 million, respectively. Proceeds from the incremental loan on the Senior Secured Credit Facility were used to fund the acquisition of Neustar, Inc. (“Neustar”). In May 2023, we amended the Senior Secured Credit Facility to replace the reference rate from London Interbank Offered Rate (“LIBOR”) to Term Secured Overnight Financing Rate (“Term SOFR”). We applied the practical expedient for reference rate reform to treat the amendment as a continuation of the existing debt agreement. During the three and six months ended June 30, 2023, we prepaid $75.0 million and $150.0 million, respectively, of our Senior Secured Term Loan B-6, funded from our cash-on-hand. As a result, we expensed $1.0 million and $2.1 million, respectively, of our unamortized original issue discount and deferred financing fees to other income and expense in our Consolidated Statement of Income. During the six months ended June 30, 2022, we prepaid $400.0 million of our Senior Secured Term Loan B-6, funded from our cash-on-hand. As a result, we expensed $6.5 million of our unamortized original issue discount and deferred financing fees to other income and expense in our consolidated statement of income. As of June 30, 2023, we had no outstanding balance under the Senior Secured Revolving Credit Facility and $1.2 million of outstanding letters of credit, and could have borrowed up to the remaining $298.8 million available. TransUnion also has the ability to request incremental loans on the same terms under the Senior Secured Credit Facility up to the sum of the greater of $1,000.0 million and 100% of Consolidated EBITDA, minus the amount of secured indebtedness and the amount incurred prior to the incremental loan, and may incur additional incremental loans so long as the senior secured net leverage ratio does not exceed 4.25-to-1, subject to certain additional conditions and commitments by existing or new lenders to fund any additional borrowings. With certain exceptions, the Senior Secured Credit Facility obligations are secured by a first-priority security interest in substantially all of the assets of Trans Union LLC, including its investment in subsidiaries. The Senior Secured Credit Facility contains various restrictions and nonfinancial covenants, along with a senior secured net leverage ratio test. The nonfinancial covenants include restrictions on dividends, investments, dispositions, future borrowings and other specified payments, as well as additional reporting and disclosure requirements. The senior secured net leverage test must be met as a condition to incur additional indebtedness, make certain investments, and may be required to make certain restricted payments. The senior secured net leverage ratio must not exceed 5.5-to-1 at any such measurement date. Under the terms of the Senior Secured Credit Facility, TransUnion may make dividend payments up to the greater of $100 million or 10.0% of Consolidated EBITDA per year, or an unlimited amount provided that no default or event of default exists and so long as the total net leverage ratio does not exceed 4.75-to-1. As of June 30, 2023, we were in compliance with all debt covenants. Interest Rate Hedging Effective May 31, 2023, we amended all our interest rate swaps to replace the reference rate from LIBOR to Term SOFR. We applied the practical expedient for reference rate reform to continue to apply hedge accounting to the existing relationships. On November 16, 2022, we entered into interest rate swap agreements with various counterparties that effectively fix our variable interest rate exposure on a portion of our Senior Secured Term Loan or similar replacement debt. The swaps commenced on December 30, 2022, and expire on December 31, 2024, with a current aggregate notional amount of $1,310.0 million that amortizes each quarter. The swaps require us to pay fixed rates varying between 4.3380% and 4.3870% in exchange for receiving a variable rate that matches the variable rate on our loans. We have designated these swap agreements as cash flow hedges. On December 23, 2021, we entered into interest rate swap agreements with various counterparties that effectively fix our variable interest rate exposure on a portion of our Senior Secured Term Loan or similar replacement debt. The swaps commenced on December 31, 2021, and expire on December 31, 2026, with a current aggregate notional amount of $1,576.0 million that amortizes each quarter. The tranche requires us to pay fixed rates varying between 1.3800% and 1.3915% in exchange for receiving a variable rate that matches the variable rate on our loans. We have designated these swap a greements as cash flow hedges. On March 10, 2020, we entered into two interest rate swap agree ments with various counterparties that effectively fix our variable interest rate exposure on a portion of our Senior Secured Term Loans or similar replacement debt. The first swap commenced on June 30, 2020, and expired on June 30, 2022. The second swap commenced on June 30, 2022, and expires on June 30, 2025, with a current aggregate notional amount of $1,090.0 million that amortizes each quarter after it commences. The second swap requires us to pay fixed rates varying between 0.8680% and 0.8800% in exchange for receiving a variable rate that matches the variable rate on our loans. We have designated these swap agreements as cash flow hedges. On December 17, 2018, we entered into interest rate swap agreements with various counterparties that effectively fixed our variable rate exposure on a portion of our Senior Secured Term Loans or similar replacement debt at 2.702% and 2.706%. These swap agreements expired on December 30, 2022. The change in the fair value of our hedging instruments, included in our assessment of hedge effectiveness, is recorded in other comprehensive income, and reclassified to interest expense when the corresponding hedged debt affects earnings. The net change in the fair value of the swaps resulted in an unrealized gain of $42.8 million ($32.1 million, net of tax) and unrealized loss of $4.6 million ($3.5 million, net of tax) for the three and six months ended June 30, 2023, respectively, recorded in other comprehensive income. The net change in the fair value of the swaps resulted in unrealized gains of $47.8 million ($35.9 million, net of tax) and $190.9 million ($143.2 million, net of tax) for the three and six months ended June 30, 2022, respectively, recorded in other comprehensive income. The impact of the swaps was a reduction to interest expense for the three and six months ended June 30, 2023 of $27.8 million ($20.8 million, net of tax) and $50.4 million ($37.8 million, net of tax), respectively. The impact of the swaps was an increase to interest expense for the three and six months ended June 30, 2022 of $8.6 million ($6.5 million, net of tax) and $22.3 million ($16.7 million, net of tax), respectively. We currently expect to recognize a gain of approximately $117.0 million as a reduction to interest expense due to our expectation that the variable rate that we receive will exceed the fixed rates of interest over the next twelve months. Fair Value of Debt As of June 30, 2023 and December 31, 2022, the fair value of our Senior Secured Term Loan B-6, excluding original issue discounts and deferred fees was approxi mately $2,300.6 million and $2,450.5 million, respectively. As of June 30, 2023 and December 31, 2022, the fair value of our Senior Secured Term Loan B-5, excluding original issue discounts and deferred fees was approximately $2,194.9 million and $2,184.4 million, respectively. As of June 30, 2023 and December 31, 2022, the fair value of our Senior Secured Term Loan A-3, excluding original issue discounts and deferred fees, was approximately $1,006.3 million an d $1,026.6 million, respectively. The fair values of our variable-rate term loans are determined using Level 2 inputs, based on quoted market prices for the publicly traded instruments. |