Affinity Gaming, Sophos, 4L Holdings break; Emerald Performance, Evertec tweak deals

By Sara Rosenberg

New York, May 4 - Affinity Gaming LLC cut the coupon on its term loan while shortening the maturity, and with the details finalized, the debt was able to free up for trading on Friday above its original issue discount price.

Also breaking was Sophos Ltd. and 4L Holdings, and in more trading news, Clear Channel Communications Inc.'s and Harland Clarke Holdings Corp.'s term loans softened with the release of first-quarter numbers.

Back over in the primary, Emerald Performance Materials LLC announced revisions to its term loan B, upsizing the tranche as a result of strong demand and tightening the original issue discount, and Evertec LLC nailed down the original issue discount on its term loan and accelerated the commitment deadline.

Furthermore, details on size and tranching on Hearthside Food Solutions LLC's credit facility surfaced as the transaction is getting ready for its launch.

Affinity starts trading

Affinity Gaming's credit facility made its into the secondary market on Friday, with the $200 million term loan (Ba3/BB) quoted at 99¾ bid, par ½ offered on the break and then it moved up to par bid, par ¾ offered, according to sources.

The loan underwent some revisions, including seeing pricing move to Libor plus 425 basis points from Libor plus 450 bps and the maturity come in to 5½ years from seven years, sources said. The 1.25% Libor floor, original issue discount of 99 and 101 soft call protection for one year were left unchanged.

The maturity was shortened because the Las Vegas-based gaming company modified the tenor on its $200 million senior notes offering to six years from eight years, one source explained. The bonds priced on Friday at 9% and were issued at par.

Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Jefferies & Co. and Macquarie Capital are leading the $235 million refinancing deal, which also includes a $35 million five-year super-priority revolver (Ba2/BB).

Sophos tops OID

Another deal to begin trading was Sophos, with its $300 million seven-year term loan B quoted at 99 bid, 99¾ offered, according to a trader.

Pricing on the loan is Libor plus 525 bps with a 1.25% Libor floor, and it was sold at an original issue discount of 981/2. There is 101 soft call protection for one year.

During syndication, the term loan B was downsized from $320 million as a five-year term loan A was upsized to €80 million from €75 million, pricing increased from Libor plus 450 bps, the discount firmed at the wide end of the 98½ to 99 talk and call protection was added.

Pricing on the term loan A is Euribor plus 450 bps, and the company's roughly $425 million equivalent credit facility (B2) also includes a $20 million five-year revolver that is priced at Libor plus 425 bps. Both of these tranches have no floor and a discount of 99.

J.P Morgan Securities LLC and RBC Capital Markets LLC are leading the refinancing deal for the IT security and data protection firm that has headquarters in Burlington, Mass., and Oxford, England.

4L frees up

4L Holdings' $265 million term loan broke for trading too, with levels quoted at 98 bid, 99 offered, according to a trader.

Pricing on the loan is Libor plus 550 bps with a 1.25% Libor floor, and it was sold at an original issue discount of 97.

During syndication, the loan was downsized from an initial amount of $300 million, pricing was increased from Libor plus 500 bps and the discount widened from 981/2.

J.P. Morgan Securities LLC is the lead bank on the deal that will be used to refinance existing debt.

4L Holdings is an electronics company.

Clear Channel retreats

Also in the secondary, Clear Channel's term loan A and term loan B were weaker as the company's parent, CC Media Holdings Inc., reported earnings results that showed a wider net loss when compared to last year, according to traders.

Post-numbers, the term loan A was quoted at 91¾ bid, 92¾ offered, down from 93¼ bid, 94¼ offered, and the term loan B was quoted at 81 bid, 82 offered, down from 82¼ bid, 83¼ offered, one trader said. The term loan C was unchanged at 79 bid, 81 offered, he added.

Meanwhile, a second trader had the San Antonio-based media and entertainment company's term loan B at 81¼ bid, 81¾ offered, down from 82½ bid, 83 offered.

For the first quarter, the company had a net loss of $143.6 million, versus a net loss of $131.8 million in the prior year.

Revenues for the quarter were $1.36 billion, up 3% from $1.32 billion in the first quarter of 2011.

And, OIBDAN was $260.4 million, down 17% from $314 million in the previous year's quarter.

Harland Clarke slides

Harland Clarke's term loan fell to 94 bid, 95½ offered from 95 bid, 96½ offered as it too posted disappointing first quarter results, according to a trader.

For the quarter, the company reported a net loss of $22.9 million, compared to net income of $23.4 million in the comparable period last year.

Revenues for the quarter were $413.8 million, up 2.5% from $403.9 million in the first quarter of 2011.

And, adjusted EBITDA for the quarter was $102.8 million, down 3.3% from $106.3 million in the prior year.

Harland Clarke is a San Antonio, Texas-based provider of integrated payment, marketing and security services and retail products.

Emerald revises loan

Switching to the primary, Emerald Performance decided to upsize its six-year first-lien term loan B (B1/B) to $300 million from $270 million since it is several times oversubscribed, and the original issue discount was moved to 99 from 981/2, according to a market source.

As before, the loan is priced at Libor plus 550 bps with a 1.25% Libor floor, and includes 101 soft call protection for one year.

Jefferies & Co. is the lead bank on the deal that will be used to refinance existing debt.

Because of the change in size, the existing second-lien term loan, which is being extended to mature after the new term loan B, will be partially repaid, the source added.

The company is also getting, through other arrangers, a new $75 million ABL revolver to replace its existing ABL revolver.

Emerald Performance is a Cuyahoga Falls, Ohio-based producer and marketer of technologically advanced specialty chemicals for food and industrial applications.

Evertec OID firms

Another company to come out with updates was Evertec, as it set the original issue discount on its $170 million incremental term loan B (BB-) due Sept. 30, 2016 at 991/4, the midpoint of the 99 to 99½ talk, while leaving pricing at Libor plus 400 bps with a 1.5% Libor floor, according to a market source.

The spread and floor match that of the existing term loan, which was sold in early 2011 at par.

Both the incremental loan and the existing loan will have 101 soft call protection for one year, extended from the prior talk of six months, the source said.

Proceeds from the new term loan and a $40 million 11% senior notes offering will be used to pay a cash dividend to the parent company.

Evertec moves deadline

Commitments towards Evertec's incremental loan and consents for an amendment are now due at 2 p.m. ET on Monday, revised from an original deadline of May 9, the source remarked, adding that closing is still targeted for May 14.

The company is seeking the amendment to its existing credit facility to allow for an up to $270 million restricted payment and increase the maximum senior secured leverage ratio by 0.25 times for each period.

Lenders are being offered a 25 bps amendment fee.

Bank of America Merrill Lynch and Morgan Stanley Senior Funding Inc. are leading the deal.

Evertec is a San Juan, Puerto Rico-based diversified processing business, offering transaction and payment processing services.

Hearthside tranching emerges

In other news, details on Hearthside Food Solutions' credit facility came out, with the $400 million deal broken down between a $30 million five-year revolver, a $30 million six-year delayed-draw term loan that is available for one year and a $340 million six-year term loan B, according to a market source.

As was already reported, the facility will be launching with a bank meeting on Wednesday.

GE Capital Markets and SunTrust Robinson Humphrey Inc. are the lead banks on the deal that will be used to refinance existing debt and fund a small dividend.

Hearthside is a Downers Grove, Ill.-based bakery and a full-service contract manufacturer of grain-based food and snack products.

Bausch fills out

Bausch & Lomb's $3.485 billion credit facility (B1/B+) is fully circled at the recently revised terms, and the expectation is that allocations will go out during the week of April 7, a market source told Prospect News.

The facility includes a $500 million five year revolver, a $2.035 billion seven-year covenant-light term loan B priced at Libor plus 425 bps, after flexing a few days ago from talk of Libor plus 375 bps to 400 bps, and $600 million seven-year covenant-light euro equivalent term loan B priced at Euribor plus 475 bps, after flexing from Euribor plus 400 bps to 425 bps.

There is also a $350 million three-year covenant-light delayed-draw term loan that is priced at Libor plus 375 bps. The maturity on this tranche was shortened from seven years, pricing firmed at the tight end of Libor plus 375 bps to 400 bps talk and the decision was made not to syndicate this debt at this time.

All of the term loans have a 1% floor and 101 soft call protection for one year, and the U.S. and euro term loan B were sold at an original issue discount of 99.

Bausch lead banks

Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Credit Suisse Securities (USA) LLC, Goldman Sachs & Co. and Bank of America Merrill Lynch are leading Bausch & Lomb's credit facility.

Proceeds will be used to refinance existing debt and fund the purchase of ISTA Pharmaceuticals Inc. for $9.10 per share in cash, or a total of about $500 million.

Closing is expected in the second quarter, subject to regulatory approval and other customary conditions, including the approval of ISTA's shareholders.

Bausch & Lomb is a Rochester, N.Y.-based eye health company. ISTA is an Irvine, Calif.-based branded prescription eye care business.

Grohe launches

Grohe AG launched its €300 million five-year first-lien covenant-light term loan in New York on Friday, and asked lenders to place their orders by May 18, according to a market source. A bank meeting to launch the deal to European investors took place in London on Wednesday.

As was reported earlier, the loan, split between $250 million and €100 million, is talked at Libor/Euribor plus 550 bps with a 1.25% floor, an original issue discount of 98½ and 101 soft call protection for one year.

Credit Suisse Securities (USA) LLC, Morgan Stanley Senior Funding Inc. and Deutsche Bank Securities Inc. are the lead banks on the deal that will be used refinance floating-rate notes.

Grohe is Düsseldorf, Germany-based manufacturer and supplier of sanitary fittings.

Osmose closes

The buyout of Osmose Holdings Inc. by Oaktree Capital Management has been completed, according to a news release.

For the transaction, Osmose got a new $300 million credit facility (B1/B+) that consists of a $45 million five-year revolver and a $255 million six-year first-lien term loan.

Pricing on the term loan is Libor plus 525 bps with a 1.25% Libor floor, and it was sold at an original issue discount of 99. There is 101 soft call protection for one year.

During syndication, the revolver was upsized from $25 million, the term loan was upsized from $240 million, pricing was reduced from Libor plus 550 bps and the discount tightened from 98.

Credit Suisse Securities (USA) LLC and Macquarie Capital led the deal.

Osmose is a Buffalo, N.Y.-based provider of wood preservation technology as well as utility and railroad asset management.

MSCI wraps

MSCI Inc. closed on its $980 million five-year credit facility (Ba1/BBB) that consists of an $880 million term loan A and a $100 million revolver, both priced at Libor plus 225 bps with step-downs based on a leverage grid, according to an 8-K filed with the Securities and Exchange Commission on Friday.

Proceeds were used to refinance an existing revolver and repay a $1.079 billion senior secured term loan B in full.

During syndication, the term loan A was upsized from $880 million, so the term loan B repayment amount was increased from up to $800 million.

Morgan Stanley MUFG Loan Partners LLC (acting through Morgan Stanley Senior Funding Inc. and the Bank of Tokyo Mitsubishi UFJ Ltd.) and J.P. Morgan Securities LLC led the deal.

MSCI is a New York-based provider of investment decision support tools, including indexes, portfolio risk and performance analytics and corporate governance services.

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