Hertz softens; Manitowoc, MetroPCS break; Sensata, Wyle, Ulterra Drilling tweak deals

By Sara Rosenberg

New York, May 9 - Hertz Global Holdings Inc.'s term loan headed lower during Monday's trading session as the company announced a new, more expensive buyout bid for Dollar Thrifty Automotive Group Inc.

Also in the secondary, Manitowoc Co. Inc.'s credit facility freed up for trading, with the term loan B quoted above its original issue discount price, and MetroPCS Wireless Inc. broke too, but only after making some changes to its term loan B-3 add-on.

In more loan happenings, Sensata Technologies BV downsized its term loan B, lowered pricing and widened the offer price, Wyle Services Corp. reverse flexed its B loan, and Ulterra Drilling Technologies reduced its credit facility size, raised pricing as well as Libor floor and modified the original issue discount.

Further, Gundle/SLT Environmental Inc. and Terra-Gen Finance Co. LLC came out with price talk now that ratings have been disclosed, Wall Street Systems and U.S. TelePacific set guidance with their launches, and SemGroup Corp., BakerCorp and SymphonyIRI Group Inc. emerged with new deal plans.

Hertz term loan slides

Hertz's term loan was weaker in trading on Monday after the company revealed that it is offering to purchase Dollar Thrifty for $72 per share, consisting of $57.60 in cash and 0.8546 shares of Hertz, according to traders.

The Park Ridge, N.J.-based auto and equipment rental company's term loan was quoted by one trader at par ¼ bid, par 5/8 offered, down from par 5/8 bid, par 7/8 offered, and by a second trader at par 3/8 bid, 101 offered, down from around par 7/8 bid, 101¼ offered.

To fund the proposal, the company would use borrowings under credit facilities and/or the issuance of debt securities, as well as cash on hand. The estimated total amount of cash needed for the transaction is around $1.9 billion.

In 2010, Hertz had reached an agreement to acquire Dollar Thrifty, a Tulsa, Okla.-based renter and leaser of vehicles, for $43.60 per share in cash and 0.6366 shares of Hertz common stock. This agreement was later terminated as Dollar Thrifty stockholders voted no on the transaction.

Manitowoc starts trading

Also on the trading front, Manitowoc's credit facility broke, with the $400 million 61/2-year term loan B quoted by one trader on the open at par ¾ bid, 101 1/8 offered and then he saw it move to par ½ bid, par 7/8 offered. A second trader was quoting the loan at par 5/8 bid, 101 offered.

The term loan B is priced at Libor plus 300 basis points with a 1.25% Libor floor and was sold at an original issue discount of 991/2. There is 101 soft call protection for one year.

The company's $1.25 billion senior secured credit facility (Ba2/BB) also includes a $500 million five-year revolver and a $350 million five-year term loan A that is priced at Libor plus 300 bps with no Libor floor.

During syndication, the B loan was upsized from $350 million, pricing was lowered from Libor plus 350 bps, and the discount tightened from 99, and the term loan A was upsized from $300 million.

Manitowoc lead banks

J.P. Morgan Securities LLC, Deutsche Bank Securities Inc., Bank of America Merrill Lynch and Wells Fargo Securities LLC are the lead banks on Manitowoc's credit facility, which will be used to refinance existing bank debt.

At Dec. 31, the company had $24.2 million outstanding under a $400 million revolver, $459.7 million of term loan A borrowings and $338.1 million of term loan B debt. Then, on Jan. 14, the company used about $124 million of the proceeds from the sale of its Kysor/Warren and Kysor/Warren de Mexico businesses to pay down term loan A and B balances.

Manitowoc is a Manitowoc, Wis.-based manufacturer and seller of cranes and related products and foodservice equipment.

MetroPCS upsizes

MetroPCS lifted its term loan B-3 add-on due March 2018 to $1 billion from $600 million and firmed the offer price at par, the tight-end of the 99 7/8 to par talk, according to a market source.

The spread is Libor plus 375 basis points and the loan has the same 101 soft call protection through March 2012 as the existing term loan B-3.

The original $500 million B-3 loan was done in March at the same pricing as the new add-on, but was sold at an original issue discount of 991/2. The tranche had been downsized from $1.5 billion, flexed up from Libor plus 350 bps and the offer price widened from par.

J.P. Morgan Securities LLC is the left lead bank on the deal.

MetroPCS frees up

Following the changes to the term loan B-3 add-on, the debt entered the secondary market, with levels on B-3 loan, inclusive of the add-on, quoted at par bid, par ½ offered, according to a trader. On Friday, the B-3, excluding the add-on, was quoted at par 1/8 bid, par ½ offered.

Proceeds from the add-on will be used to repay the company's existing term loan B-1 due 2013 and for general corporate purposes, including opportunistic spectrum acquisitions. The repayment of the B-1 was supposed to happen when the B-3 was done in March, but was eliminated due to the downsizing.

Pricing on the B-1 was Libor plus 225 bps, but it was moved to Libor plus 382 bps due to Most Favored Nation language when the original term loan B-3 was completed.

MetroPCS, a Dallas-based provider of unlimited wireless communications service for a flat rate with no annual contract, expects to close on the add-on in mid-May.

Sensata changes size, pricing

Moving back to the primary, Sensata Technologies revised its credit facility structure, lowering the seven-year covenant-light term loan B to $1.1 billion from $1.2 billion on the back of the company's bond offering being upsized to $700 million from $600 million, according to a market source.

Pricing on the term loan was moved to Libor plus 300 bps with a 1% Libor floor and an original issue discount of 991/2, from talk of Libor plus 350 bps to 375 bps with a 1% floor and a par offer price, the source said.

Additionally, the soft call protection on the term loan was pushed out to one year from six months, the source remarked.

Commitments were due from lenders at 5 p.m. ET on Monday.

Sensata getting revolver

Sensata's $1.35 billion credit facility (Ba3/BB+), down from $1.45 billion, also includes a $250 million five-year revolver.

Morgan Stanley & Co. Inc. and Barclays Capital Inc. are the joint lead arrangers on the deal, with Goldman Sachs & Co., BMO Capital Markets Corp. and RBC Capital Markets LLC the bookrunners.

Proceeds from the credit facility and the notes, which priced on Friday at par to yield 6½%, will be used to repay existing term loans, 8% senior notes due 2014 and 9% senior subordinated notes due 2016 and for general corporate purposes.

The tender offers for the notes expire on May 25.

Sensata is an Attleboro, Mass.-based designer and manufacturer of sensors and controls.

Wyle cuts spread

Wyle Services lowered pricing on its $283 million term loan B (B1/BB), which is based on corporate ratings of B3/B+, to Libor plus 425 bps from Libor plus 450 bps, and trimmed the step-down that takes effect upon achieving corporate ratings of B2/B to Libor plus 350 bps from Libor plus 375 bps, according to a market source.

The 1.5% floor, 101 soft call protection for one year and discount price of 99¾ were left intact.

The term loan B is part of an amendment, extension and repricing transaction, under which the maturity of the term loan will be pushed out by one year to 2017.

Pricing on the B loan is coming down from the current rate of Libor plus 575 bps with a 2% Libor floor. Current pricing is based on a grid. If the corporate rating is B2/B, the spread is Libor plus 450 bps when senior leverage is less than 2.85 times and Libor plus 500 bps when senior leverage is more than 2.85 times. And, if the corporate rating is lower than B2/B, pricing is Libor plus 525 bps at less than 2.85 times senior leverage and Libor plus 575 bps at more than 2.85 times senior leverage.

Wyle revising covenants

In addition to the repricing and extension, Wyle is asking to amend its term loan to remove the total leverage and interest coverage covenants and to restructure the senior secured covenant to 4½ times for the life of the loan.

Additionally, the accordion feature would be governed by an incurrence covenant of 4 times, whereas before it was tied to the interest coverage test, and there would be a 6 times incurrence test on total debt, as opposed to being limited by the leverage covenant.

Barclays Capital Inc. is the lead bank on the deal.

Wyle is an El Segundo, Calif.-based provider of high-tech systems engineering, testing and information technology services.

Ulterra reworks deal

Ulterra Drilling Technologies reduced its five-year credit facility (Caa1/B-) to $97.5 million from $105 million by reducing the term loan to $82.5 million from $90 million, according to a market source. The deal still provides for a $15 million revolver.

Also, pricing on both tranches was lifted to Libor plus 750 bps from Libor plus 650 bps, the Libor floor increased to 2% from 1.5% and the original issue discount moved to 98 from 981/2, the source said.

Furthermore, call protection on the term loan was sweetened to 102 in year one and 101 in year two from just 101 soft call protection for one year, the source added.

Jefferies & Co. is the lead bank on the deal that will be used to refinance existing debt and add cash to the balance sheet for general corporate purposes.

Ulterra is a Fort Worth, Texas-based oilfield service manufacturer of PDC drill bits and stick-slip reduction tools.

Gundle talk emerges

Gundle/SLT released price talk on Monday morning on its up to $210 million credit facility now that ratings have been received by both Moody's Investors Service and Standard & Poor's, according to a market source.

On Friday, Moody's said that the company's revolver and first-lien term loan are rated B3, and the second-lien is rated Caa1. Ratings from Standard & Poor's surfaced late Thursday at B- on the revolver and first-lien term loan and CCC+ on the second-lien term loan.

The $40 million to $45 million revolver and $125 million first-lien term loan are being talked at Libor plus 525 bps to 550 bps with a 1.5% Libor floor and an original issue discount of 99, and the $40 million second-lien term loan is being talked at Libor plus 875 bps to 900 bps with a 1.5% floor and a discount of 98, the source said.

Gundle call protection

Gundle/SLT's first-lien term loan has 101 soft call protection for one year and the second-lien term loan has call protection of 102 in year one and 101 in year two, a source previously told Prospect News.

Jefferies & Co. and GE Capital Markets are the lead banks on the deal that was launched with a bank meeting last Thursday.

Proceeds will be used to refinance existing ABL credit facility debt and notes.

Leverage is 3.5 times through the first-lien and 4.8 times total.

Gundle/SLT is a Houston-based manufacturer and marketer of geosynthetic lining products and services.

Terra-Gen reveals guidance

Terra-Gen also launched last Thursday but waited until now to come out with price talk following the obtainment of ratings of Ba3/BB/BB- on its $360 million senior secured credit facility, according to a market source. The Moody's and Fitch ratings came out on Friday, and the S&P rating was released on Thursday.

The facility, comprised of a $60 million five-year working capital revolver and a $300 million six-year term loan B, is talked at Libor plus 400 bps with a 1.25% Libor floor and an original issue discount of 991/2, with the B loan having 101 soft call protection for one year.

Goldman Sachs & Co. and Credit Suisse Securities (USA) LLC are leading the deal that will be used to fully repay existing corporate level debt, fund a cash distribution to parent company Terra-Gen Power LLC and help fund a debt service reserve.

The New York-based renewable energy provider is asking for commitments by May 19.

Wall Street price talk

Wall Street Systems held a bank meeting on Monday afternoon to kick off syndication on its proposed credit facility, and in connection with the launch, price talk on the $350 million deal was disclosed, according to market sources.

The $25 million five-year revolver is talked at Libor plus 400 bps with a 1.5% Libor floor, the $200 million six-year first-lien term loan is talked at Libor plus 400 bps with a 1.5% floor and a discount of 991/2, and the $125 million seven-year second-lien term loan is talked at Libor plus 750 bps with a 1.5% floor, a discount of 99 and call protection of 102 in year one and 101 in year two, sources said.

The company's $350 million credit facility, which is being led by Credit Suisse Securities (USA) LLC, will be used to help fund the buyout of the company by ION Investment Group, a portfolio company of TA Associates, from Warburg Pincus.

Wall Street Systems is a New York-based provider of treasury management, central banking and FX trade processing services. ION is a provider of trading technology and trade processing services.

U.S. TelePacific add-on

U.S. TelePacific launched on Monday a $50 million term loan add-on that is being offered at an original issue discount of 99 and carries the same pricing as the existing term loan of Libor plus 450 bps with a 1.25% Libor floor, according to market sources.

The existing $435 million six-year term loan was obtained in February and was sold at par. The tranche includes 101 soft call protection for one year, which the add-on will have as well.

Credit Suisse Securities (USA) LLC is the lead bank on the deal that will be used for acquisition financing.

U.S. TelePacific is a Los Angeles-based competitive local exchange carrier.

SemGroup sets launch

In other news, SemGroup is getting ready to hold a bank meeting on Tuesday to launch a $650 million credit facility that will be used to refinance existing debt, according to a market source.

The facility consists of a $350 million five-year revolver, a $100 million five-year term loan A and a $200 million seven-year term loan B, the source said.

RBS Securities Inc. is the left lead bank on the deal.

SemGroup is a Tulsa, Okla.-based midstream service company.

BakerCorp readies loan

BakerCorp is another deal that will be launch on Tuesday, with the company set to hold a bank meeting at 9:30 a.m. ET, according to market sources.

The $435 million credit facility includes a $390 million seven-year covenant-light term loan B and a $45 million revolver, sources said.

Deutsche Bank Securities Inc. and Morgan Stanley & Co. Inc. are the lead banks on the deal that will be used to help fund the buyout of the company by Permira funds for $960 million.

The acquisition is expected to close by July, subject to customary regulatory approvals.

BakerCorp is a Seal Beach, Calif.-based provider of equipment rental services for liquid and solid containment applications.

SymphonyIRI plans deal

SymphonyIRI Group is scheduled to launch a $450 million credit facility (B1/B+) on Wednesday with a bank meeting that has a 2 p.m. ET start time and will take place at the Pierre Hotel in New York, according to a market source.

The facility consists of a $50 million five-year revolver that includes senior secured leverage and interest coverage covenants and a $400 million 61/2-year covenant-light term loan B, the source said.

Bank of America Merrill Lynch, Jefferies & Co. and BMO Capital Markets Corp. are leading the deal that will be used, along with $420 million of equity, to fund the buyout of the company by New Mountain Capital LLC and management.

SymphonyIRI is a Chicago-based provider of sales and marketing data and analytic services for customers in the consumer packaged goods and consumer health industries.

Exopack coming soon

Also set to hold a bank meeting on Wednesday is Exopack Holdings Corp., at which time it will launch a proposed $475 million credit facility that is being led by Bank of America Merrill Lynch and Goldman Sachs & Co., according to a market source.

The facility consists of a $75 million five-year ABL revolver and a $400 million six-year covenant-light term loan, the source said, adding that price talk is not yet available.

Proceeds, along with $225 million of senior unsecured notes, will be used to repay all outstanding borrowings under the company's existing revolver, purchase any and all of its outstanding 11¼% senior notes due 2014 and make a distribution to stockholders.

Exopack is a Spartanburg, S.C.-based full-service paper and plastic flexible packaging products manufacturer.

Restaurant Tech syndicates

Restaurant Technologies Inc.'s proposed senior facility has already been spoken for by a small group of investors, and credit documents are expected to circulate later this week, a market source told Prospect News.

BNP Paribas Securities Corp. and GE Capital Markets are the lead banks on the deal that will be used to help fund the buyout of the company by EQT Infrastructure from Parthenon Capital Partners and ABS Capital Partners.

Other funds for the buyout will come from equity.

Closing of the acquisition is expected to occur in the second quarter, subject to anti-trust approval.

Following completion of the transaction, leverage will be around 4.0 times.

Restaurant Technologies is a Minneapolis-based provider of cooking oil management services to the foodservice industry.

Frac Tech closes

Frac Tech International LLC, a Cisco, Texas-based oilfield service company, closed on its recapitalization, according to a news release. The recapitalization involved its acquisition by Temasek Holdings Ltd. and RRJ Capital from the Wilks family and a dividend payment to Chesapeake Energy Corp.

To fund the transaction, Frac Tech got $1.7 billion of term loans (B2/B+) priced at Libor plus 475 bps with a step-down to Libor plus 450 bps, subject to the repayment of $500 million of the debt with initial public offering proceeds and leverage being under 2.0 times. There is a 1.5% Libor floor and 101 soft call protection for one year.

The debt, led by Bank of America Merrill Lynch and Citigroup Global Markets Inc., is comprised of a $1.5 billion five-year funded term loan B and a $200 million delayed-draw term loan.

The funded term loan was sold at an original issue discount of 99, and the delayed-draw loan was offered at 99¾ and includes a 250 bps unused fee. If the delayed-draw was funded at close, the original issue discount would be 99.

Sensus wraps deal

Sensus USA Inc., a Raleigh, N.C.-based technology company providing energy and water utility customers with conservation products and services, completed its $675 million senior secured credit facility, according to a news release.

The facility consists of a $100 million five-year revolver, a $425 million six-year first-lien term loan and a $150 million seven-year second-lien term loan.

Proceeds from the credit facility, along with cash on hand, were used to fund a tender offer for the company's $275 million of 8 5/8% senior subordinated notes due 2013, refinance existing bank debt, pay a $50 million dividend and put some working capital cash on the balance sheet.

Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. led the deal.

Sensus pricing details

Pricing on Sensus' first-lien term loan is Libor plus 350 bps with a step-down to Libor plus 325 bps if total net leverage is less than 4 times. There is a 1.25% Libor floor and 101 soft call protection for one year, and the debt was sold at an original issue discount of 991/2.

The second-lien term loan, meanwhile, is priced at Libor plus 725 bps with a 1.25% Libor floor, and it was sold at a discount of 99. There is call protection of 103 in year one, 102 in year two and 101 in year three.

During syndication, the first-lien term loan was upsized from $375 million, pricing was cut from Libor plus 375 bps, the step-down and call protection were added and the discount price was changed from 99.

As for the seven-year second-lien term loan, it was reduced from $200 million, pricing was trimmed from Libor plus 750 bps and the original issue discount was moved from 981/2.

Aeroflex completes refi

Aeroflex Inc. reduced closed on its $800 million credit facility (B1/BB-) that was used to refinance an existing term loan and 11.75% of high-yield debt, according to a news release.

The facility consists of a $725 million seven-year term loan B priced at Libor plus 300 bps, after flexing from talk of Libor plus 325 bps to 350 bps, with a 1.25% Libor floor, and a $75 million five-year revolver.

The term loan was sold at an original issue discount of 99½ and has 101 soft call protection for one year.

J.P. Morgan Securities LLC, Goldman Sachs & Co., Morgan Stanley & Co. Inc. and Credit Suisse Securities (USA) LLC acted as the lead banks on the deal.

Aeroflex is a Plainview, N.Y., maker of radio frequency and microwave integrated circuits, components and systems used in wireless communication systems.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.