PRA International breaks; LCDX rises with equities; Chrysler structure, price talk emerge

By Sara Rosenberg

New York, Nov. 6 - PRA International's credit facility allocated and freed up for trading on Tuesday, with the first-out term loan quoted north of its original issue discount price, and LCDX was a touch stronger as stocks improved.

In other news, Chrysler Corp. LLC (Chrysler Auto) started circulating details on its first-lien term loan, such as structure, price talk, discount and call protection, as the deal's Wednesday bank meeting is fast approaching.

PRA International's credit facility hit the secondary market on Tuesday, with the $170 million first-out term loan (B1/BB-) quoted at 98½ bid, 99 offered, according to a market source.

The first-out term loan is priced at Libor plus 325 basis points and was sold to investors at a discount of 98.

PRA International's $295 million senior secured credit facility also includes a $40 million revolver (B1/BB-) priced at Libor plus 325 bps and an $85 million first-loss term loan (B3/CCC+) that was placed prior to the deal's bank meeting.

UBS Securities LLC and Jefferies Finance LLC are the joint lead arrangers and joint bookrunners on the deal.

Proceeds, along with $170 million in mezzanine financing, will be used to help fund the buyout of the company by Genstar Capital, LLC for $30.50 in cash per share. The transaction is valued at about $790 million.

Originally, the company planned to finance the buyout with a $40 million six-year revolver expected at Libor plus 275 bps, a $255 million seven-year first-lien term loan expected at Libor plus 275 bps, a $115 million 71/2-year second-lien term loan expected at Libor plus 650 bps and $55 million of mezzanine debt, according to filings with the Securities and Exchange Commission.

PRA International is a Reston, Va., clinical research organization.

LCDX trades up with stocks

LCDX 9 gained some ground during Tuesday's market hours in sympathy with equities, according to traders.

The index went out at 97.30 bid, 97.40 offered, up from Monday's levels of 97.10 bid, 97.30 offered, traders said.

As for stocks, Nasdaq closed up 30 points, or 1.07%, Dow Jones Industrial Average closed up 117.54 points, or 0.87%, S&P 500 closed up 18.10 points, or 1.20%, and NYSE closed up 143.59 points, 1.44%.

Chrysler details surface

Structure and pricing guidance came out on Chrysler Autos' first-lien term loan, which is now going to be a single-tranche that is smaller than the originally funded amount because $2.5 billion was paid down using restricted cash on the balance sheet, according to a market source.

The first-lien term loan will be presented to lenders at a Wednesday morning bank meeting with a size of $7.5 billion, price talk of Libor plus 400 bps and an original issue discount in the 97½ area, the source said.

The loan is non-callable for one year, then at 104 in year two, 102 in year three and 101 in year four.

"Not sure if the entire thing will go on offer tomorrow though," the source remarked. "It may be split up. Not sure what JPMorgan is doing about that."

The structure on the first-lien loan has changed from the structure that the deal was funded with and from the structure that was seen when the deal was in market this past summer.

When the loan funded in August, it was documented as a $5 billion first-out term loan (Ba3/BB-) and a $5 billion second-out term loan (B3/B).

And, before being pulled from market in July because of primary conditions, it was structured as one $10 billion tranche that was guided at Libor plus 375 bps, after flexing up from original talk at launch of Libor plus 325 bps, with call protection of non-callable for one year then at 101 in year two.

Since word started floating around that the Chrysler Auto debt would be coming back to market, sources have been saying that they expected the structure to change. One of the most recent rumors on structure had been that the loan could come as a $9 billion single-tranche deal.

JPMorgan, Goldman Sachs, Citigroup, Bear Stearns and Morgan Stanley are the bookrunners on the deal, with JPMorgan, Goldman and Citigroup the joint lead arrangers.

Proceeds from the term loan were used to help fund the acquisition of a majority interest in the company by Cerberus Capital Management, LP from DaimlerChrysler AG.

Chrysler Auto also got a $2 billion delayed-draw seven-year second-lien term loan that was funded by Cerberus - who took down $500 million - and DaimlerChrysler - who took down $1.5 billion - and the agreement was made that this loan would not come back for broad syndication for at least a year from close.

The second-lien term loan is delayed-draw for 12 months and must fund after that time. Originally, the tranche was expected to be funded at close.

Before being taken out of market, the second-lien term loan was being talked at Libor plus 700 bps, up from original talk of Libor plus 600 bps, with call protection of non-callable for one year, then at 103 in year two and 101 in year three.

Chrysler Auto is a producer and seller of Chrysler, Dodge and Jeep vehicles.

United Test and Assembly ups OID

United Test and Assembly Center Ltd. raised the original issue discount on its $625 million term loan B to the 95 to 96 area, from the original discount level of 97, according to a market source.

The term loan B is talked at Libor plus 312.5 bps.

United Test and Assembly Center's $775 million covenant-light credit facility (Ba3/BB-) also includes a $150 million revolver.

JPMorgan, Merrill Lynch and ABN Amro are the lead banks on the deal.

Proceeds will be used to help fund the buyout of the company by Global A&T Electronics Ltd., a special-purpose company formed by Affinity Equity Partners and TPG Capital, for S$1.20 per share.

United Test and Assembly is a Singapore-based provider of semiconductor assembly and testing services for a broad range of integrated circuits.

Plains Exploration closes

Plains Exploration & Production Co. closed on its $2.9 billion amended and restated revolving credit facility, according to an 8-K filed with the Securities and Exchange Commission.

JPMorgan and BMO Capital Markets acted as the joint lead arrangers and joint bookrunners on the deal.

Pricing can range from Libor plus 100 bps to Libor plus 200 bps depending on utilization.

There is a $400 million accordion feature.

Proceeds were used to help fund the acquisition of Pogo Producing Co.

Plains Exploration is a Houston-based oil and gas company.

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