ATP Oil & Gas breaks above OID; LCDX inches lower; FTD fills out; Getty readies allocations

By Sara Rosenberg

New York, June 27 - ATP Oil & Gas Corp.'s term loans freed up for trading on Friday, with the strip of debt quoted atop the original issue discount price at which it was sold during the syndication process, and LCDX 10 softened a bit in sympathy with equities.

In other news, FTD Group Inc.'s credit facility was in good shape ahead of Friday's commitment deadline and Getty Images Inc. is getting ready to allocate its credit facility as the recent revisions to the deal were received positively by the market, keeping it well oversubscribed.

ATP Oil & Gas' strip of term loan debt hit the secondary market on Friday with levels seen north of the papers' original issue discount price, according to a trader.

The $1.65 billion strip of term loan was quoted at 97¾ bid, 98¼ offered on the break and then it moved up to 98 bid, 98½ offered, where it closed out the day, the trader said.

Tranching on the deal is comprised of a $1.05 billion first-lien senior secured term loan due in July 2014 and a $600 million asset-sale term loan due in January 2011.

Pricing on both tranches is Libor plus 525 basis points with a 3.25% Libor floor, and the debt was sold to investors at an issue discount of 971/2.

The spread on the asset-sale loan will go up by 50 bps on July 1, 2009 and increase by an additional 50 bps every six months following that date.

The term loan due in 2014 carries call protection of 102 in year one and 101 in year two.

During syndication, pricing on the term loans was increased from original talk at launch of Libor plus 475 bps and the discount was widened from 98.

Credit Suisse acted as the lead bank on the deal that was used to refinance the company's existing $1.2 billion senior secured term loan and to repay the $210 million subordinated loan with an all-in interest rate of 15%.

Closing on the deal was announced by the company on Friday.

"The new term facility provides two very important pieces of capital for ATP. First, it puts in place a truly long-term, six-year financing of $1.05 billion at rates that are extremely competitive in today's market. This facility will provide ATP the ability to continue to execute its plans for development and acquisitions for the next several years," said T. Paul Bulmahn, chairman and chief executive officer, in a company news release.

"Secondly, and equally important, the new facility provides an asset-sale facility that will enable ATP to reduce its debt by $600 million in the near term in accordance with the 2008 ATP Employee Challenge goals established in March 2008. We are well under way in our program to monetize value already created in our property, platform and infrastructure assets."

ATP is a Houston-based oil and gas acquisition, development and production company.

LCDX trades lower

LCDX 10 was a touch weaker on Friday as equities continued to slide, according to a trader.

The index was quoted at 97.15 bid, 97.30 offered, down from 97.25 bid, 97.35 offered, the trader said.

As for stocks, Nasdaq closed down 5.74 points, or 0.25%, Dow Jones Industrial Average closed down 106.91 points, or 0.93%, S&P 500 closed down 4.77 points, or 0.37%, and NYSE closed down 17.23 points, or 0.20%.

FTD going well

Switching to the primary, syndication on FTD's credit facility is moving along nicely as the $200 million six-year term loan B was fully subscribed by Friday's close of business commitment deadline, according to a market source.

The term loan B is talked at Libor plus 450 bps with a 3% Libor floor and an original issue discount of 98.

At launch, pricing guidance on the term loan B came out in the context of Libor plus 400 bps to 450 bps, with a 3% Libor floor and an original issue discount in the 98 to 99 range - but it was said that the actual talk would be dependant on credit ratings, and once those private ratings were obtained, the price talk became more focused.

FTD's $450 million credit facility also includes a $75 million five-year revolver and a $175 million five-year term loan A, with both of these tranches talked at Libor plus 350 bps with a 3% Libor floor.

Upfront fees on the revolver and the term loan A are 50 bps for commitments of less than $25 million, 75 bps for commitments in the $25 million to $35 million range and 100 bps for commitments of more than $35 million.

Financial covenants under the credit facility include a leverage ratio, a fixed-charge coverage ratio and a maximum capital expenditures requirement.

Wells Fargo is the lead arranger, bookrunner and administrative agent on the deal that will be used to help fund United Online Inc.'s acquisition of FTD for $7.34 in cash, 0.4087 of a share of United Online common stock and $3.31 principal amount of United Online 13% senior secured notes due 2013 per share.

The total consideration to FTD stockholders will be about $456 million, consisting of $222 million in cash, 12.35 million shares of United Online stock and $100 million total principal amount of notes.

The remaining purchase price consists of repayment of FTD debt and expenses incurred in connection with the transaction.

Total and senior leverage at close will be 3.6 times.

Upon closing of the transaction, the former FTD stockholders will own about 15% of United Online.

The acquisition is anticipated to be completed during the third quarter, subject to approval of FTD stockholders, a financing condition and customary closing conditions.

After the closing of the transaction, FTD will continue to operate as a wholly owned subsidiary of United Online from FTD's existing facilities, including its U.S. headquarters in Downers Grove, Ill., and its international headquarters in the United Kingdom.

FTD is a provider of floral related products and services. United Online is a Woodland Hills, Calif., provider of consumer internet and media services.

Getty Images allocations near

Getty Images is hoping to allocate its credit facility sometime during the week of June 30, and being that the week is a shortened one day due to the July 4 holiday, the target is to get the allocations done in the first half of the week, according to a market source.

The $1.045 billion senior secured credit facility (BB) consists of a $75 million five-year revolver priced at Libor plus 400 basis points with a 50 bps commitment fee, and a $970 million seven-year term loan priced at Libor plus 400 bps with a step down to Libor plus 375 bps when leverage is less than 2.25 times and an original issue discount of 971/2. Both tranches carry a 3.25% Libor floor.

On June 24, a number of changes were made to this credit facility, including lowering pricing on the revolver and the term loan from initial talk at launch of Libor plus 425 bps, adding the pricing step down to the term loan and reducing the original issue discount on the term loan from initial guidance of 97.

These revisions were all well received by investors and, as before, the deal is still more than two times oversubscribed, the source added.

Originally the term loan was broken down into a $265 million 40-day delayed-draw tranche and a $705 million funded tranche, with both pieces basically being marketed as one term loan. However, now there's basically no more delayed-draw piece as it's expected to fund pretty much right away.

Barclays, GE Capital and RBS Securities are the joint bookrunners on the deal, with Barclays and GE acting as co-lead arrangers. GE is the administrative agent.

Financial covenants include a maximum total leverage ratio and a minimum consolidated interest coverage ratio.

Proceeds will be used to help fund the buyout of the company by Hellman & Friedman LLC for $34 per share in cash. The transaction is valued at $2.4 billion, including the assumption of existing debt.

Other financing will come from up to $941.3 million in equity.

The transaction, which was approved by stockholders at a special meeting on June 20, is expected to close during the week of June 30.

Getty Images is a Seattle-based creator and distributor of still imagery, footage and multi-media products, and a provider of other forms of digital content.

B/E Aerospace reduces size

B/E Aerospace Inc. downsized its six-year term loan following an upsizing to its bond offering, according to a market source.

The term loan is now sized at $475 million, down from $575 million, and the 10-year senior notes, which priced at par to yield 8½%, are now sized at $600 million, up from $500 million, the source said.

Final pricing on the bonds came at the high end of initial price talk in the 8¼% to 8½% range.

The term loan is still being talked at Libor plus 275 bps with a 3% Libor floor and an original issue discount of 981/2.

B/E Aerospace's now $825 million senior secured credit facility (Ba1/BBB-), down from $925 million, also includes a $350 million five-year revolver that is talked at Libor plus 275 bps with a 3% Libor floor.

JPMorgan, UBS and Credit Suisse are the joint lead arrangers and joint bookrunners on the credit facility that was first launched with a bank meeting on June 23, with JPMorgan the administrative agent.

Covenants include an interest coverage ratio and a total leverage ratio.

Proceeds from the term loan and the bonds will be used to help fund the acquisition of Honeywell International Inc.'s Consumables Solutions distribution business and to repay existing bank debt. The revolver, which is expected to be undrawn at close, will be available for working capital and general corporate purpose.

The actual credit facility commitment letter provides for an up to $1.55 billion credit facility, comprised of a $350 million revolver and a $1.2 billion term loan. However, under the commitment letter, the actual amount of borrowings available under the credit facility were to be reduced to the extent that the company obtain certain other financing, which is what happened when the notes offering was announced.

Furthermore, when the company first announced the acquisition, it had said in a news release that the facility was going to be sized at $1.35 billion, divided into a $350 million revolver and a $1 billion term loan B.

B/E Aerospace is buying the Honeywell business for $800 million in cash plus $250 million in common stock or cash, at the company's option, although in no event will fewer than 6 million shares be issued if the value of the stock component is less than $250 million.

The transaction is expected to close in the third quarter subject to customary closing conditions, including U.S. antitrust notification and reports pursuant to the Hart-Scott-Rodino Act as well as German antitrust approvals.

The notes are not conditioned on the completion of the acquisition. If the acquisition is not completed, proceeds from the notes will be used to repay the term loan under the company's existing senior secured credit facility and for working capital and general corporate purposes. The company's existing $200 million revolver would be left in place.

B/E Aerospace is a Wellington, Fla.-based manufacturer of aircraft cabin interior products and an aftermarket distributor of aerospace fasteners.

Mobile Mini closes

Mobile Mini Inc. closed on its new $900 million five-year asset-based senior secured revolving credit facility, according to a news release.

Pricing on the revolver is Libor plus 250 bps, with an unused fee that can range from 25 bps to 37.5 bps based on usage.

During syndication, the revolver was downsized from $1 billion.

Deutsche Bank, Bank of America and JPMorgan acted as the lead banks on the deal.

Financial covenants include a maximum leverage ratio, minimum fixed-charge coverage ratio and minimum utilization rate, each of which will only be tested if excess availability under the borrowing base is less than the greater of $100 million and 10% of the total commitments under the credit facility.

Proceeds were used to help fund the acquisition of Mobile Storage Group Inc. from Welsh, Carson, Anderson & Stowe in a transaction valued at $716 million.

Under the transaction, Mobile Mini assumed Mobile Storage's outstanding debt and paid cash totaling about $562 million and issued around 8.6 million shares of Mobile Mini preferred stock with a liquidation preference of $154 million.

Following the closing of the acquisition, Mobile Mini has availability of over $280 million remaining under its new revolver.

Tempe, Ariz.-based Mobile Mini and Glendale, Calif.-based Mobile Storage are providers of portable storage.

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