NES, Kendle, Allied Security, BHM, BWAY set talk; Hawkeye tweaks pricing; Clearwire resets launch

By Sara Rosenberg

New York, June 22 - NES Rentals Holdings Inc., Kendle International Inc., Allied Security Holdings LLC, BHM Technologies LLC and BWAY Corp. came out with price talk on their credit facilities as all of these deals were launched to investors with bank meetings during Thursday's market hours.

In other primary news, Hawkeye Renewables LLC revised pricing higher on its credit facility because of ratings and Clearwire Corp. has moved its bank meeting to next week to launch a proposed credit facility that details have yet to emerge on.

NES Rentals detailed price talk on its $880 million credit facility at its bank meeting, with the $450 million five-year ABL revolver launched at Libor plus 175 basis points and the $430 million seven-year second-lien term loan launched at Libor plus 550 basis points, according to a market source.

The revolver carries a 25 basis point undrawn fee, and pricing on the tranche is subject to a grid, the source added.

On the revolver, Deutsche Bank and Bank of America are acting as joint leads, with Deutsche on the left.

On the second-lien term loan, Deutsche Bank, Bank of America and Bear Stearns are acting as joint leads, with Deutsche on the left.

Proceeds will be used to help fund the leveraged buyout of NES by Diamond Castle Holdings LLC for $18.75 per share in cash. The transaction is valued at about $850 million including the assumption of certain liabilities.

Completion of the transaction is subject to customary closing conditions, including regulatory approvals, financing and the approval of NES' stockholders.

NES is a Chicago-based aerial and general equipment rental and traffic safety services provider.

Kendle price talk

Kendle released price talk on its $225 million senior secured credit facility as syndication on this deal also officially kicked off with a bank meeting during the Thursday session, according to a source.

Both the $25 million five-year revolver and the $200 million six-year term loan were launched with opening talk set at Libor plus 250 basis points, the source said.

UBS is the lead arranger on the deal.

Proceeds will be used to help fund the company's purchase of Charles River Laboratories International, Inc.'s phase 2 to 4 Clinical Services business, a provider of phase 2-4 clinical trials management services to the pharmaceutical and biotechnology industries.

Kendle is a Cincinnati-based clinical research organization that provides a range of phase 1-4 clinical development services to the pharmaceutical and biotechnology industries.

Allied Security sets talk

Allied Security was another firm that announced price talk on Thursday as it launched its $275 million term loan D to lenders with an opening spread of Libor plus 300 basis points, according to a market source.

Bear Stearns is the lead bank on the deal.

The term loan will have a maturity of June 30, 2010, with the possibility of an extension for an additional two years under certain circumstances.

The $275 million of term loan D debt is essentially the company's existing term loan debt, which is being repriced from Libor plus 375 basis points, plus $85 million of incremental term loan debt that will be used to help fund the acquisition of Initial Security LLC, the source explained.

Allied Security is acquiring the San Antonio-based security services business of Initial Security in the United States for about £40 million from Rentokil Initial plc.

King of Prussia, Pa.-based Allied Security is a private security services firm.

BHM Technologies talk

Continuing on the spread front, BHM Technologies came out with price talk on its $335 million credit facility, with both the $35 million six-year revolver and the $220 million seven-year first-lien term loan B launched at Libor plus 250 basis points, and the $80 million 71/2-year second-lien term loan launched at Libor plus 575 basis points, according to a market source.

Lehman is the lead bank on the deal.

Proceeds from the new credit facility will be used to help fund First Atlantic Capital's leveraged buyout of the auto supplier.

BWAY spread guidance

Lastly, BWAY announced opening price talk of Libor plus 175 to 200 basis points on all tranches contained under its $295 million senior secured credit facility (Ba3) as it too was presented to lenders during Thursday's session.

Tranching on the facility is comprised of a $50 million six-year revolver, a $5 million Canadian six-year revolver, a $190 million seven-year term loan B and a $50 million six-year term loan C.

Deutsche Bank and JPMorgan are joint lead arrangers on the deal that will be used to help fund the acquisition of Industrial Containers Ltd.'s plastic and steel general line pail business, and refinance BWAY's existing credit facility.

The closing of the acquisition, which is expected to occur in July, is subject to customary conditions, including the consummation of the bank financing.

BWAY is an Atlanta-based manufacturer of steel and plastic containers for the general line category of the North American container industry.

Hawkeye flexes up

Hawkeye Renewables made some changes to its first- and second-lien debt as ratings from Moody's Investors Service emerged, creating a situation where pricing had to be adjusted higher to fit those ratings, according to a market source.

Pricing on both the $500 million first-lien term loan and the $50 million revolver was flexed up to Libor plus 350 basis points from original talk at launch of Libor plus 325 basis points, the source said. The revolver carries a 50 basis point commitment fee.

In addition, pricing on the $150 million second-lien term loan was flexed up to Libor plus 725 basis points from original talk at launch of Libor plus 700 basis points, the source continued. This tranche carries call protection of 102 in year one and 101 in year two.

Moody's rated the revolver and first-lien term loan at B3 and the second-lien term loan at Caa1, the source added.

Credit Suisse and Bank of America are joint lead arrangers and joint bookrunners on the deal, with Credit Suisse also the administrative agent.

Proceeds from the credit facility will be used to fund the acquisition of an approximate 80% ownership interest in Hawkeye by Thomas H. Lee Partners LP, to refinance the company's $185 million term loan, to refinance its $55.6 subordinated notes, and for working capital and general corporate purposes.

In connection with the Thomas H. Lee purchase, Hawkeye Holdings Inc. is planning an initial public offering of common stock. Prior to the IPO, a new holding company structure will be implemented under which Hawkeye Renewables will become an indirect wholly owned limited liability company subsidiary of Hawkeye Holdings.

Those who choose to participate in Hawkeye's new credit facility, regardless of which lien they play in, are being offered on a pro rata basis $20 million of co-invest in the equity with final allocations.

Hawkeye Renewables is an Iowa Falls, Iowa, manufacturer of alcohol-based fuel derived from corn.

Clearwire reschedules

Clearwire has postponed its bank meeting to next Wednesday from its originally scheduled launch date of this Thursday morning due to scheduling conflicts, according to a market source.

Morgan Stanley, Merrill Lynch and JPMorgan are the lead banks on the deal, with Morgan Stanley the left lead.

Details on the structure of the facility are not available as of yet.

Proceeds will be used for general corporate purposes.

Clearwire is a Kirkland, Wash., provider of wireless high-speed internet and internet phone service.

NRG heads higher

Switching over to the secondary, NRG Energy Inc. felt a bit stronger in trading on Thursday as people became more comfortable with the company's recently announced repowering initiative, according to a trader.

The bank debt closed the session quoted at par 1/8 bid, par 3/8 offered, up from previous levels of 99 7/8 bid, par 1/8 offered, the trader said.

On Wednesday, NRG announced plans to develop about 10,500 megawatts of new generation capacity over the next decade, representing a total investment of $16 billion that will be funded with the support of partners and project finance debt.

"People are starting to think that if they stick with the plan of projects, they could be successful," the trader said in explanation of the positive momentum on the bank debt.

"Also, the bonds bounced back today after falling a bit yesterday so that helped," the trader added.

NRG is a Princeton, N.J.-based wholesale power generation company.

ATP Oil & Gas closes

ATP Oil & Gas Corp. closed on its new $525 million term loan that is priced with an interest rate of Libor plus 325 basis points, according to a company news release.

During syndication, pricing on the term loan was reverse flexed from original talk at launch of Libor plus 350 basis points.

Credit Suisse acted as the lead bank on the deal.

Proceeds were used to replace the company's $350 million term loan that carried an interest rate of Libor plus 550 basis points, and will be used to help fund the acquisition of some offshore properties.

The new term loan also added provision to allow for share repurchases and amended covenants to provide additional flexibility.

ATP is a Houston-based natural gas and oil company.

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