Freedom Group term trades up on break; SLS Las Vegas boosts pricing; LCDX down 1/8 point

By Paul A. Harris

Portland, Ore., April 13 - The LCDX 18 bank loan index finished the Friday session an eighth of a point lower at 96 5/8 bid, 97 1/8 offered, according to a trader.

In the primary market, Freedom Group Inc.'s $330 million term loan priced and broke for trading.

SLS Las Vegas dramatically boosted pricing on its $300 million five-year term loan.

In the face of falling equity prices, cash loans held in and ended the day unchanged, the source said.

The HD Supply term loan B was unchanged at 98¾ bid, 99½ offered. The $1 billion 51/2-year term loan B (B2/B+) priced at 97 earlier this month.

The cash flows of the bank loan funds remained positive during the most recent week, market sources said.

Bank loan funds saw $281 million of net inflows for the week to April 11, sources said, referring to a weekly report from Lipper-AMG.

A portion of that cash is likely migrating from high yield bonds, a bank loan trader said. The source added that the junk market has run long and hard and is not perceived to have a lot of upside left.

Indeed, Lipper-AMG reported a $1.293 billion outflow from junk for the week to April 11.

Freedom Group breaks higher

Freedom Group's $330 million Libor plus 450 basis points seven-year covenant-light term loan B priced at 99 and traded to par bid, par ½ offered on Friday.

The deal, which features a 1.25% Libor floor, priced on top of price talk.

The loan includes 101 soft call protection for one year, the source said.

Bank of America Merrill Lynch, Deutsche Bank Securities Inc. and RBC Capital Markets LLC are the lead banks on the deal.

Proceeds will be used to help repurchase notes.

The company previously announced tender offers for $245.2 million of 11¼%/11¾% senior PIK notes due 2015 at FGI Holding Co. and $247.5 million of 10¼% senior secured notes due 2015 at FGI Operating Co. LLC.

The tender offers will expire on April 27.

Freedom Group is a Madison, N.C.-based designer, manufacturer and marketers of firearms, ammunition and related products for the hunting, shooting sports, law enforcement and military markets.

SLS Las Vegas lifts pricing

SLS Las Vegas boosted pricing on its $300 million five-year term loan B (B2/B-).

Pricing was increased to Libor plus 1,100 basis points from 850 bps. The original issue discount talk deepened to 95; the deal was previously talked at 98.

The Libor floor remains unchanged at 2%.

Call protection was increased to three years from two years. The initial call premium was increased to 106 from 102, while the second call premium was increased to 103 from 101.

Recommitments were due by the end of the day.

Previous to the price changes, the loan was downsized to $250 million. With the boosted pricing, however, the deal amount was increased back to its original $300 million size.

J.P. Morgan Securities LLC is the lead bank on the deal.

Proceeds will be used to fund the renovation of the SLS Las Vegas (formerly the Sahara Hotel and Casino).

The actual borrower is Stockbridge/SBE Holdings LLC.

SLS Las Vegas is a Las Vegas-based hotel and casino operator.

HUB launches A&E

Hub International Ltd. launched an amendment and extension proposal on Friday.

The Chicago-based insurance company is seeking to extend its original term loans by three years, to June 2017. Lenders are offered a 200 basis points increase in coupon, moving the Libor spread to 450 bps. There is $729 million of term loan debt outstanding.

In addition, HUB is seeking to extend its incremental term loan by 3.5 years to December 2017 with no change in pricing. There is $195 million of incremental term loan debt outstanding.

HUB is also seeking to extend its US revolving credit facility by three years to June 2016 with a 200 bps increase in pricing, increasing the Libor spread to 450 bps.

The consent fee is 10 basis points.

Commitments are due by noon ET on April 20.

Morgan Stanley & Co., RBC Capital Markets and Bank of America Merrill Lynch are leading the deal.

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