Mediacom slides on buyout bid; Protection One readies allocations; AWAS Aviation overfills

By Sara Rosenberg

New York, June 1 - Mediacom Communications Corp. saw the bank debt of its subsidiaries head lower during Tuesday's trading session after the company revealed that it has received a going-private proposal from its founder.

Moving to the primary market, Protection One Inc. is expected to allocate its credit facility shortly, and AWAS Aviation Capital Ltd.'s loan has reached oversubscription at the recently revised terms.

Mediacom LLC trades down

Mediacom Communications' subsidiary, Mediacom LLC, saw its term loans fall in the secondary market after news emerged that Rocco B. Commisso, founder, chairman and chief executive officer, has offered to purchase the parent company, according to traders.

The Mediacom LLC term loan E was quoted by one trader at 95½ bid, 96½ offered, down from 97½ bid, 98¼ offered, and by a second trader at 96 1/8 bid, 97 1/8 offered, down 1½ points on the day.

The LLC term loan D was quoted by the first trader at 97 bid, 98 offered, down from 98½ bid, 99¼ offered, and by the second trader at 96 7/8 bid, 97 7/8 offered, down 1 1/8 points from Friday.

And, the LLC term loan C was quoted by the first trader at 90¼ bid, 91¼ offered, down from 92½ bid, 93¼ offered, and by the second trader at 90¾ bid, 91¾ offered, down 1¼ point on the day.

Mediacom Broadband down, too

In addition, the term loans of Mediacom Broadband, another subsidiary of Mediacom Communications, were softer on the buyout proposal as well, traders remarked.

The Mediacom Broadband term loan F was quoted by one trader at 96¼ bid, 97¼ offered, down from 98¼ bid, 99 offered, and by a second trader at 96½ bid, 97½ offered, down from 98 bid, 99 offered.

Lastly, the Mediacom Broadband term loan D was quoted by the first trader at 91 bid, 92 offered, down from 93 bid, 93¾ offered, and by the second trader at 90¾ bid, 91¾ offered, down from 91¾ bid, 92¾ offered.

Mediacom buyout may up leverage

Traders explained that the Mediacom LLC and the Mediacom Broadband term loans traded down because if Mediacom Communications accepts Commisso's acquisition bid, the company's leverage would increase.

Mediacom said in a news release that Commisso expects to use borrowings under the company's existing credit facility to fund the buyout offer, which provides for the purchase of all class A and class B common stock at a price of $6 per share.

The proposed transaction will not result in a change of control under the company's existing debt arrangements.

A special committee has been formed to review the proposal, and that committee will retain independent financial advisors and legal counsel to assist in its work.

Mediacom is a Middletown, N.Y.-based cable company.

Protection One allocating soon

Over on the new deal front, Protection One is anticipated to allocate and free up for trading its $415 million senior secured credit facility (BB) on Wednesday or Thursday, according to an informed source.

The facility includes a $25 million five-year revolver with a 75 bps commitment fee and a $390 million six-year term loan that is priced in line with initial talk at Libor plus 425 basis points with a 1.75% Libor floor and an original issue discount of 981/2.

Financial covenants under the facility include a maximum total leverage ratio, a minimum interest coverage ratio and a maximum amount of capital expenditures.

Protection One being bought

Proceeds from Protection One's bank debt, which is being led by JPMorgan and Barclays, $150 million of mezzanine financing and $340 million in equity will be used to fund the buyout of the company by GTCR for $15.50 per share. The total purchase price, including the refinancing of debt, is roughly $828 million.

The mezzanine notes are priced at 12.5% in cash plus 1% PIK, and TCW/Crescent Mezzanine has committed to purchase the debt.

Closing is expected in the second quarter, subject to minimum levels of participation in the tender offer and regulatory approvals.

Protection One is a Lawrence, Kan.-based provider of electronic security services to the residential, commercial and wholesale markets.

AWAS fills out

Talk is that AWAS' $530 million six-year term loan (Ba2/BBB-) is oversubscribed at the new terms that were announced late last week, and allocations are expected to go out sometime this week, according to a market source.

The term loan is priced at Libor plus 575 bps with a 2% Libor floor and an original issue discount of 97. The loan is non-callable for one year, then at 102 in year two and par thereafter.

Prior to the changes, the loan was talked at Libor plus 500 bps to 550 bps with a 1.75% Libor floor, an original issue discount of 98 and 101 soft call protection for one year.

AWAS refinancing debt

Proceeds from AWAS' term loan will be used to refinance its outstanding JetStream and JetBridge loan facilities.

Security for the loan is interests in a portfolio of 30 aircraft.

Goldman Sachs and Credit Agricole are the joint lead arrangers on the deal that is hoped to close by the end of the week.

AWAS is a Dublin-based aircraft leasing company.

MSCI closes

In other news, MSCI Inc. closed on its $1.375 billion senior secured credit facility (Ba2/BB+), consisting of a $100 million five-year revolver and a $1.275 billion six-year term loan B, according to a news release.

Pricing on the term loan B is Libor plus 325 bps with a step-down to Libor plus 300 bps at 2.75 times leverage and a 1.5% Libor floor, and it was sold at an original issue discount of 991/2.

During syndication, pricing on the oversubscribed term loan was reduced from Libor plus 350 bps, the step-down was added and the discount was tightened from 99.

MSCI lead banks

Morgan Stanley acted as the lead arranger and bookrunner on MSCI's deal, with Credit Suisse the syndication agent and Bank of America the documentation agent.

Proceeds were used to help finance the acquisition of RiskMetrics Group Inc. and to refinance existing debt, and will also be available to fund the ongoing working capital of the company.

MSCI is a New York-based provider of investment decision support tools to investment institutions. RiskMetrics is a New York-based provider of risk management and corporate governance products and services to the financial community.

Dave & Buster's closes

Dave & Buster's Inc. closed on its $200 million credit facility (Ba2/BB-), consisting of a $50 million revolver and a $150 million term loan B, according to a news release.

Pricing on the term loan B is Libor plus 425 bps with a 1.75% Libor floor, and it was sold at an original issue discount of 99.

JPMorgan and Jefferies acted as the joint lead arrangers and bookrunners on the deal that was used to fund the buyout of the company by Oak Hill Capital Partners from Wellspring Capital Management LLC in a transaction valued at about $570 million.

Dave & Buster's is a Dallas-based owner and operator of restaurant/entertainment venues.

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