Landry's postponed again; Lehman portfolio sale pulled; Tribune lower with market; LCDX down

By Sara Rosenberg

New York, Sept. 16 - Landry's Restaurants Inc. has delayed the launch of its proposed credit facility for a second time, although in this case, the postponement is due to Hurricane Ike.

In other news, Lehman Brothers removed its portfolio of loan names that was up for sale from market as the possibility of a new owner entered into the picture.

Also on Tuesday, Tribune Co.'s term loan B headed lower with the rest of the cash market and LCDX 10 was weaker as well.

Landry's Restaurants has once again postponed the bank meeting for its proposed $300 million senior secured credit facility, this time as a result of Hurricane Ike, according to a market source.

"They have a lot of properties in Houston/Galveston area. They need to deal with damage and know what the insurance is like," the source explained.

Originally, the bank meeting was scheduled for Sept. 4, but then it was pushed off to Sept. 18. Now it is delayed until an undetermined date, the source said, adding that it could be next week or it could be later than that.

The facility consists of a $50 million five-year revolver and a $250 million five-year term loan A.

According to filings with the Securities and Exchange Commission, pricing on the revolver and the term loan A is expected to be Libor plus 400 basis points, with a 3.25% Libor floor, and the revolver has a 50 bps commitment fee.

Official price talk on the deal, however, has not yet been announced.

Amortization on the term loan is 2.5% in year one, 7.5% in year two and 10% in years three, four and five, with the rest due at maturity.

Wells Fargo Foothill and Jefferies are the co-lead arrangers, co-bookrunners and co-syndication agents on the deal, with Well Fargo the administrative agent.

Proceeds from the credit facility will be used to help fund the buyout of the company by Fertitta Holdings Inc for $21 per share in cash. The total value of the deal is about $1.3 billion, including about $885 million of debt.

Fertitta is a newly formed entity wholly owned by the company's chairman, president, chief executive officer and original founder, Tilman J. Fertitta, who beneficially owns about 39% of the company's outstanding common shares.

Landry's is a Houston-based restaurant, hospitality and entertainment company.

Lehman portfolio pulled

Lehman Brothers' roughly $880 million portfolio of leveraged loans that was put up for sale on Monday, with bids supposed to be due on Tuesday at 2 p.m. ET, was taken out of market as a result of talk that Barclays may purchase the bankrupt bank, according to a market source.

The portfolio included par and distressed names divided into about 170 tranches of debt.

"With possibility of new owner coming in, [they] had to postpone/withdraw it because [they] don't know what they want to do," the source explained.

On Tuesday, reports emerged saying that Barclays is close to a deal to buy Lehman's main U.S. broker-dealer business, including equity, fixed income, M&A advisory as well as some other entities.

The news comes a day after Lehman announced that it filed for Chapter 11.

Along with the filing, Lehman said that it is exploring the sale of its broker-dealer operations and is in advanced discussions with a number of potential purchasers to sell its Investment Management Division.

Tribune drops with cash, LCDX slides

Tribune's term loan B traded off by a couple of points on Tuesday just in sympathy with the rest of the market, according to a trader.

The Chicago-based media company's term loan B was seen trading a lot in the 60 level, compared to Monday's quotes of 63 bid, 65 offered, the trader said.

"Things definitely finished down. Might have popped off their lows, but still down anywhere from a half to two points on the day," a second trader remarked about the cash market in general. "People are just selling things today."

"Everything is all over the place. Tone is negative," another trader remarked.

"Cash opened significantly weaker today," a third trader said, explaining that after the open, things started creeping back up a little bit, but overall names were still down on the day.

"For example, take First Data [Corp.'s] term loan B2: 89½ bid early, then 89¼ bid. Rallied to 90¼ bid late day. Yesterday finished out 91 to 911/2," the third trader added.

As for LCDX 10, levels went out around 94.40 bid, 94.60 offered, compared to Monday's levels of 95.10 bid, 95.20 offered, traders said. One trader said that the index was seen as low as 93 bid, 93.30 offered early in the morning before creeping back up over the course of the session.

"I think it was the AIG thing, talk that they're getting Federal backing. Also, Lehman being acquired by Barclays and Morgan Stanley announced better-than-expected earnings. The pulled Lehman [portfolio] also helped a little," the trader said in explanation of why things may have come off their lows.

Meanwhile, the stock market ended the day positive, with Nasdaq up 27.99 points, or 1.28%, Dow Jones Industrial Average up 141.51 points, or 1.30%, S&P 500 up 20.90 points, or 1.75%, and NYSE up 112.98 points, or 1.47%.

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