OSI Restaurant, Kinder Morgan firm pricing; Oceania, RGIS break; Ford trades lower

By Sara Rosenberg

New York, April 27 - OSI Restaurant Partners Inc. finalized pricing on its term loan and pre-funded revolving credit facility at the high end of revised guidance, and Kinder Morgan Inc. firmed pricing on its term loan B at the low end of talk.

Meanwhile, in secondary happenings, Oceania Cruises Inc.'s credit facility freed up for trading with both the first- and the second-lien term loans quoted atop par, and RGIS Holdings LLC's credit facility broke as well, with its term loan debt quoted in the upper par to 101 context.

In other trading news, Ford Motor Co.'s term loan came in slightly as investors had a chance to reevaluate first-quarter numbers and the market tone in general was weaker.

OSI Restaurant Partners firmed up pricing on its term loan and pre-funded revolver at the wide end of the recently revised guidance, meaning that the two tranches still ended up 25 basis points lower than original price talk, according to a market source.

The $1.23 billion seven-year term loan and the $100 million six-year pre-funded revolver are now both priced at Libor plus 225 bps with a step down to Libor plus 200 bps upon achieving B1 corporate ratings or better. The company's current corporate rating is B2.

Original price talk on these two tranches had been Libor plus 250 bps, but a few days ago, the talk was revised to Libor plus 212.5 bps to 225 bps with the 25 bps step down due to the deal being four times oversubscribed.

In addition, at the same time as the price talk revision, the term loan had been upsized by $150 million from $1.08 billion after the company downsized its bond offering by the equivalent amount.

OSI's $1.48 billion senior secured credit facility (Ba3/BB-) also includes a $150 million six-year revolver that is priced at Libor plus 250 bps.

Deutsche Bank and Bank of America are the lead banks on the deal, with Deutsche the left lead.

Proceeds will be used to help fund the leveraged buyout of the company by an investor group comprised of Bain Capital Partners, LLC, Catterton Partners and company founders Chris T. Sullivan, Robert D. Basham and J. Timothy Gannon.

The total transaction value, including assumed debt, is $3.2 billion, with OSI stockholders receiving $40.00 per share in cash.

Other leveraged buyout financing will come from $550 million in high-yield notes, real estate financings, $827.3 million in cash equity and $217.5 million in rollover equity.

OSI is a Tampa, Fla., casual dining restaurant company with a portfolio of brands, including Outback Steakhouse, Carrabba's Italian Grill, Bonefish Grill, Fleming's Prime Steakhouse & Wine Bar, Roy's, Lee Roy Selmon's, Blue Coral Seafood & Spirits and Cheeseburger in Paradise.

Kinder sets pricing

Kinder Morgan finalized pricing on its $2.3 billion seven-year term loan B on Friday at Libor plus 150 bps, the tight end of original guidance of Libor plus 150 bps to 175 bps, according to a market source.

Being that the term loan B was already oversubscribed within a few days of launching to retail investors, some had already expected this low-end pricing to be the final outcome.

Kinder Morgan's $7.3 billion credit facility (Ba2/NA/BB) also includes a $2 billion 61/2-year term loan A and a $1 billion six-year revolver that are priced at Libor plus 162.5 bps and a $2 billion three-year asset-sale bridge term loan C that is priced at Libor plus 137.5 bps.

Citigroup, Goldman Sachs, Deutsche Bank, Wachovia and Merrill Lynch are the lead banks on the deal.

Proceeds will be used to help fund the company's public-to-private buyout by management and equity investors.

Under the acquisition, chairman and chief executive officer Richard D. Kinder and other members of management, including co-founder Bill Morgan, current board members Fayez Sarofim and Mike Morgan, and investment partners Goldman Sachs Capital Partners, American International Group, Inc., the Carlyle Group and Riverstone Holdings LLC will acquire all of the outstanding common stock of Kinder Morgan for $107.50 per share in cash.

All in all, the transaction is valued at about $22 billion, including the assumption of about $7 billion of debt.

Kinder Morgan is a Houston-based energy infrastructure provider.

Oceania frees to trade

Moving to the secondary market, Oceania Cruises' credit facility allocated and broke for trading with the $300 million first-lien term loan (B1/B) quoted at par 1/8 bid, par ½ offered, according to a market source.

In addition, the $75 million second-lien term loan (Caa1/CCC+) was quoted at par 1/8 bid on the open and then moved up to par 3/8 bid, where it closed out the day, the source said.

The first-lien term loan is priced at Libor plus 225 bps and the second-lien term loan is priced at Libor plus 575 bps with call protection of 102 in year one and 101 in year two.

Oceania Cruises' $415 million credit facility also includes a $40 million revolver (B1/B) priced at Libor plus 225 bps.

Lehman Brothers and UBS are the lead banks on the deal, which will be used to help fund Apollo Management LP's acquisition of the company in a transaction valued at about $850 million, including the assumption of debt.

Oceania is a Miami-based upper-premium cruise line.

RGIS breaks

Also freeing up for trading on Friday was RGIS, with its strip of funded and delayed-draw term loan debt quoted at par ¾ bid, 101 offered, according to a market source.

Both the $500 million funded term loan and the $25 million delayed-draw term loan are priced at Libor plus 250 bps with a step down to Libor plus 225 bps at less than 4.0 times leverage. During syndication, the step down was added to the two tranches.

The delayed-draw term loan carries a 75 bps undrawn fee.

RGIS' $600 million credit facility (Ba3/B-) also includes a $75 million revolver priced at Libor plus 250 bps with a 50 bps undrawn fee.

Goldman Sachs is the lead bank on the deal, which is expected to close on Monday. Wachovia joined the transaction as administrative agent and General Electric Corp. signed on as documentation agent.

Proceeds from the facility, along with mezzanine financing, will be used to help fund the Blackstone Group's acquisition of a controlling interest in the company. The current RGIS ownership group will retain a significant stake in the company post-close.

RGIS is an Auburn Hills, Mich., inventory and retail services company.

Ford dips in trading

Ford's term loan was a touch lower in Friday's market as people had more time to digest the company's recently announced first-quarter numbers and the secondary in general was "wider and weaker," according to a trader.

The term loan ended the day quoted at par 5/8 bid, par 7/8 offered, down from Thursday's closing levels of par ¾ bid, 101 offered, the trader said. On Thursday, the loan had moved as high as 101 bid, 101 1/8 offered immediately after financials were released.

For the first quarter, the Dearborn, Mich.-based automaker reported a net loss of 15 cents per share, or $282 million, compared with a net loss of 76 cents per share, or $1.4 billion, in the first quarter of 2006.

First-quarter revenue was $43 billion, up from $40.8 billion a year ago, primarily reflecting mix improvement and favorable currency exchange, partially offset by lower volume.

"The numbers were okay but if you looked at them again they were kind of smoke and mirrors," the trader said. "[Ford's] still burning cash. Still a lot of work to get done before the restructuring is over.

"Also, stuff generally felt sluggish all day. Heading into the weekend guys were happy to take profits. More sellers than buyers," the trader added.

Patheon closes

Patheon Inc. closed on its new $225 million credit facility consisting of a $150 million seven-year term loan (B1/B+) and a $75 million five-year revolver (B1/BB), according to a company news release.

The term loan is priced at Libor plus 250 bps. During syndication, pricing was flexed up from original talk of Libor plus 200 bps to 225 bps.

JPMorgan and General Electric Capital Corp. acted as the lead banks on the deal.

Proceeds from the credit facility, along with a $150 million convertible preferred share investment by JLL Partners Fund V, LP, were used to refinance the company's existing North American and U.K. credit facilities.

Patheon is a Mississauga, Ont., provider of drug development and manufacturing services to the pharmaceutical industry.

Iasis closes

Iasis Healthcare LLC closed on its new $854 million credit facility (Ba2/B) consisting of a $439 million seven-year term loan, a $150 million seven-year delayed-draw term loan, a $225 million six-year revolver and a $40 million seven-year synthetic letter-of-credit facility, according to a company news release.

The funded term loan, delayed-draw term loan and synthetic letter-of-credit facility are all priced at Libor plus 225 bps, and the revolver is priced at Libor plus 200 bps.

The delayed-draw loan carries a 100 bps undrawn fee.

Bank of America and Citigroup acted as the lead banks on the deal.

Proceeds were used to refinance the company's existing credit facility. The delayed-draw loan will be used to fund capital projects, including completion of the company's previously announced 171-bed Mountain Vista Medical Center located in Mesa, Ariz., which is scheduled to open in June, and for other general corporate purposes.

Iasis is a Franklin, Tenn., owner and operator of medium-sized acute care hospitals.

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