Drillships, Boulder, Meritas break; CityCenter dips; Surgery, Key Safety, Blackbrush revised

By Sara Rosenberg

New York, July 18 – Drillships Ocean Ventures Inc.’s (Ocean Rig), Boulder Brands Inc. and Meritas School Holdings LLC freed up for trading on Friday, and CityCenter Holdings LLC’s term loan softened on repricing news.

Over in the primary, Surgery Center Holdings Inc. (Surgery Partners) increased sizes and lowered pricing on its first- and second-lien term loans, adjusted the offer price on the first-lien tranche and canceled plans for a holdco loan.

Also, Key Safety Systems Inc. trimmed spreads on its first- and second-lien term loans and tightened the original issue discount on the first-lien tranche, and BlackBrush Oil & Gas (BBOG Borrower LP) upsized its second-lien term loan and modified the offer price.

In addition, Quorum Business Solutions released timing on its credit facility, and CCM Merger Inc. (MotorCity Casino Hotel) and St. George’s University emerged with new deal plans.

Drillships Ocean trading

Drillships Ocean Ventures’ $1.3 billion senior secured term loan B (B2/B+) surfaced in the secondary market on Friday with levels quoted at par ½ bid, 101¼ offered, according to a market source.

Pricing on the term loan is Libor plus 450 basis points with a 1% Libor floor and it was sold at an original issue discount of 99. There is call protection of 103 in year one, 102 in year two and 101 in year three.

Recently, the term loan was upsized from $800 million as the company canceled plans for a $500 million senior secured notes offering, and pricing was cut from talk of Libor plus 475 bps to 500 bps.

Deutsche Bank Securities Inc. and Credit Suisse Securities (USA) LLC are leading the deal that will be used to help refinance a $1.35 billion senior secured term loan.

Based in Nicosia, Cyprus, Drillships is a subsidiary of Ocean Rig UDW Inc., a Greece-based international offshore drilling contractor.

Boulder Brands breaks

Boulder Brands, a Paramus, N.J.-based health and wellness food company, saw its credit facility begin trading as well, with the $300 million term loan B quoted at par bid, according to a trader.

The term loan B is priced at Libor plus 350 bps with a leveraged-based grid that has step-ups and a 1% Libor floor.

Of the total term loan B amount, $250 million is existing debt that is being repriced from Libor plus 400 bps with a 1% Libor floor and the remainder is an add-on that was increased to $50 million from $40 million during syndication, resulting in the total loan size being lifted from $290 million. Lenders were offered a 25 bps upfront fee on the new money and a 25 bps amendment fee.

Along with the term loan B, the company was seeking an increase to its revolver to $120 million from $80 million and to amend its credit facility to allow for acquisition flexibility.

RBC Capital Markets, Citigroup Global Markets Inc., BMO Capital Markets and Barclays are leading the deal.

Meritas frees up

Meritas School’s $80 million 6½-year second-lien term loan (Caa2/CCC+) freed up too, with levels seen at par bid, 101 offered, a trader said.

Pricing on the loan is Libor plus 900 bps with a 1% Libor floor and it was issued at a discount of 99½. There is call protection of 103 in year one, 102 in year two and 101 in year three.

During syndication, pricing on the term loan firmed at the tight end of the Libor plus 900 bps to 925 bps talk, the Libor floor was cut from 1.25% and the discount was changed from 98½.

Credit Suisse Securities (USA) LLC and BMO Capital Markets are leading the deal that the Northbrook, Ill.-based family of private college-preparatory schools will use for a dividend recapitalization.

As part of the transaction, the company is amending its existing first-lien loan to permit the second-lien loan and dividend and reset the 101 soft call protection for six months, and first-lien lenders were offered a 15 bps amendment fee.

The first-lien loan was quoted at par ½ bid, 101½ offered in trading on Friday, the trader added.

CityCenter weakens

Also in trading, CityCenter’s term loan was seen by one trader at par bid, par ½ offered, down from par 3/8 bid, par ¾ offered, and by a second trader at par 1/8 bid, par 5/8 offered, down from par 5/8 bid, 101 offered, as a repricing of the debt was launched.

For the repricing, the company launched a $1,456,000,000 covenant-light term loan B due October 2020 talked at Libor plus 325 bps with a 1% Libor floor, a par offer price and 101 soft call protection for six months, a market source said.

This will take the term loan pricing down from Libor plus 400 bps with a 1% Libor floor.

Leads, Bank of America Merrill Lynch, Barclays, BNP Paribas Securities Corp., SMBC Nikko Capital Markets and UBS AG, are asking for commitments by noon ET on Wednesday.

CityCenter is the owner and operator of a mixed-use development located on the Las Vegas Strip.

Surgery Center restructures

Switching to the primary, Surgery Center raised its six-year first-lien term loan to $870 million from $820 million, reduced pricing to Libor plus 425 bps from talk of Libor plus 450 bps to 475 bps, and changed the original issue discount to 99½ from 99, while leaving the 1% Libor floor and 101 soft call protection for one year unchanged, according to a market source.

Furthermore, the seven-year second-lien term loan was lifted to $490 million from $440 million and the spread was lowered to Libor plus 750 bps from talk of Libor plus 775 bps to 800 bps, the source said. This tranche still has a 1% Libor floor and call protection of 103 in year one, 102 in year two and 101 in year three.

With the first- and second-lien loan upsizings, the company eliminated plans for a $100 million holdco term loan that was talked at 12% to 12.5% PIK with call protection of 103 in year one, 102 in year two and 101 in year three, except for in year one when it would have been callable at 101 for a qualified equity offering.

Surgery Center getting revolver

In addition to the first- and second-lien term loans, Surgery Center’s $1.44 billion credit facility includes an $80 million revolver.

Recommitments were due at 3 p.m. ET on Friday.

Jefferies Finance LLC, KKR Capital and MCS Capital are leading the deal that will be used to fund the $792 million acquisition of Symbion Holdings Corp., a Nashville-based owner and operator of short-stay surgical facilities, from Crestview Partners.

Opco first-lien leverage is 4.73 times, up from 4.5 times under the original structure, and total leverage is 7.2 times, up from 6.7 times, including $25 million of synergies, the source added.

Closing is expected in the fourth quarter, subject to customary conditions and regulatory approvals.

Surgery Center is a Chicago-based owner and operator of Ambulatory Surgery Centers.

Key Safety flexes lower

Key Safety cut pricing on its $420 million seven-year first-lien term loan (Ba2/B+) to Libor plus 350 bps from talk of Libor plus 375 bps to 400 bps and changed the original issue discount to 99½ from 99, while keeping the 1% Libor floor and 101 soft call protection for six months intact, according to a market source.

Also, pricing on the $100 million eight-year second-lien term loan (B2/B) was trimmed to Libor plus 700 bps from talk of Libor plus 725 bps to 750 bps, with the 1% Libor floor, discount of 99 and call protection of 102 in year one and 101 in year two unchanged.

The company’s $600 million credit facility also includes an $80 million revolver (Ba2/B+).

Recommitments were due at noon ET on Friday, the source added.

UBS AG, Citigroup Global Markets Inc. and Nomura are leading the deal that will be used to fund the company’s buyout by FountainVest Partners from Crestview Partners.

Key Safety Systems is a Sterling Heights, Mich.-based supplier of automotive safety restraint systems and components.

Blackbrush tweaks deal

BlackBrush Oil & Gas increased its seven-year second-lien term loan to $300 million from $275 million and moved the original issue discount to 99¼ from 99, a market source said.

As before, the loan is priced at Libor plus 650 bps with a 1% Libor floor, and there is call protection of 102 in year one and 101 in year two.

Recommitments were due at noon ET on Friday, the source added.

UBS AG, Bank of America Merrill Lynch and Credit Suisse Securities (USA) LLC are leading the deal that will be used to help fund the buyout of the company by Ares Management LP from EIG Management Co. LLC and Tailwater Capital LLC.

Closing is targeted for July 25.

BlackBrush is a San Antonio-based oil and gas exploration and development company.

Quorum timing emerges

In more primary news, Quorum Business Solutions came out with timing on its $140 million senior secured credit facility, with the deal slated to launch with a conference call at 3 p.m. ET on Monday, a source remarked.

As previously reported, the facility consists of a $15 million revolver and a $125 million seven-year term loan.

RBC Capital Markets is leading the deal that will be used to help fund the buyout of the company by Silver Lake Partners from the Carlyle Group and Riverstone Holdings.

Silver Lake and management rollover equity will comprise more than 60% of the capitalization.

Closing is expected following the satisfaction of customary conditions and approvals.

Quorum is a provider of software and services to manage operational, administrative, financial and transactional business processes for energy, renewables and natural resource industry segments.

CCM Merger on deck

CCM Merger set a bank meeting for 2 p.m. ET in New York on Monday to launch a $490 million seven-year senior secured term loan B, according to a market source.

Bank of America Merrill Lynch and Wells Fargo Securities LLC are leading the deal that will be used to refinance existing senior credit facility debt.

CCM Merger is the operator of MotorCity Casino, a multi-story gaming, hotel, dining convention/conference and entertainment facility near downtown Detroit.

St. George’s coming soon

St. George’s University scheduled a bank meeting for 3 p.m. ET on Tuesday to launch a $275 million credit facility, according to a market source.

The facility consists of a $25 million revolver, and a $250 million seven-year covenant-light term loan talked at Libor plus 500 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, the source said.

Commitments are due on Aug. 4.

Credit Suisse Securities (USA) LLC, Goldman Sachs Bank USA and Deutsche Bank Securities Inc. are leading the deal that will be used for a recapitalization in connection with an equity investment.

St. George’s is a Grenada, West Indies-based for-profit medical, veterinary and arts and sciences school.

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