Husky, Embanet-Compass Knowledge free up; Quad/Graphics dips with refi; Dole Food tweaks deal

By Sara Rosenberg

New York, June 24 - Husky International Ltd. and Embanet-Compass Knowledge Group made their way into the secondary market on Friday, with both companies' term loans quoted above their original issue discount prices.

Also in trading, Quad/Graphics Inc.'s term loan B was a little bit lower on the back of news that the company will be approaching the market in the near-term with a refinancing transaction.

Meanwhile, over in the primary, Dole Food Co. Inc. firmed pricing on its covenant-light term loans at the high end of talk but added a leverage-based step-down, and the original issue discount widened from initial talk.

In addition, SunCoke Energy Inc. revealed that it will be launching a new credit facility during the week of June 27 in connection with its separation from Sunoco Inc.

Husky starts trading

Husky International's credit facility broke for trading on Friday, with the $920 million covenant-light term loan B quoted at par bid, par ½ offered on the open and then it moved to par ¼ bid, par ½ offered, according to a trader.

Pricing on the term loan B is Libor plus 525 basis points with a 1.25% Libor floor, and it was sold at an original issue discount of 99. There is hard call protection of 101 for one year.

During syndication, pricing firmed at the high end of revised talk of Libor plus 500 bps to 525 bps and up from initial talk of Libor plus 425 bps to 450 bps, the original issue discount came at the wide end of the 99 to 99½ guidance and the call protection was changed from a soft call.

The company's $1.03 billion credit facility (B) also provides for a $110 million revolver.

Husky lead banks

Goldman Sachs & Co., Morgan Stanley & Co. Inc., RBC Capital Markets LLC and TD Securities (USA) LLC are the lead banks on Husky's credit facility.

Proceeds will be used to help fund the buyout of the company by Berkshire Partners LLC and Omers Private Equity Inc. from Onex Corp. for $2.1 billion.

Other funds for the acquisition will come from $570 million of eight-year senior notes that were privately placed.

Closing on the transaction is expected early in the third quarter, subject to customary conditions.

Husky is a Bolton, Ont.-based supplier of injection molding equipment and services to the plastics industry.

Embanet-Compass breaks

Embanet-Compass Knowledge also hit the secondary market, with its $125 million six-year term loan quoted at 99½ bid, par offered, according to a market source.

Pricing on the term loan is Libor plus 425 bps, after tightening from Libor plus 450 bps during syndication. There is a 1.25% Libor floor and it was sold at an original issue discount of 99.

The company's $130 million credit facility also includes a $5 million five-year revolver.

Credit Suisse Securities (USA) LLC, BNP Paribas Securities Corp. and BMO Capital Markets Corp. are the lead banks on the deal that will be used to refinance existing debt.

Embanet-Compass is a Chicago-based provider of online learning services to universities and colleges.

Quad/Graphics slides

Quad/Graphics' term loan B moved to par bid, par 1/8 offered from par ¼ bid, par ¾ offered as investors reacted to Thursday night's announcement that a refinancing is in the works, according to a trader.

As was already reported, to fund the refinancing, the company is planning a bank meeting at 10:30 a.m. ET on Tuesday to launch a $1.5 billion credit facility, consisting of an $800 million five-year revolver, a $400 million five-year term loan A and a $300 million seven-year term loan B.

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

The company's existing credit facility was obtained in 2010 as a $530 million four-year revolver and a $700 million six-year term loan B, of which about $685 million was outstanding as of March 31.

Pricing on the existing term loan B is Libor plus 400 bps with a 1.5% Libor floor, and it was sold at an original issue discount of 981/2.

Quad/Graphics is a Sussex, Wis.-based provider of print and related services.

Dole updates pricing

Moving to the primary, Dole Food set the spread on its $900 million of covenant-light term loans (Ba2/BB-) - comprised of a $315 million term B and $585 million term C - at Libor plus 375 bps, the wide end of the Libor plus 350 bps to 375 bps talk, according to a market source.

However, a step-down was added to the term loans to Libor plus 350 bps when net total leverage is less than 3.5 times, but it can only take effect after Jan. 1, 2012, the source remarked.

Also, the original issue discount on the term loans moved to 99¼ from 991/2, while the 1.25% Libor floor and 101 soft call protection for one year were left intact, the source added.

The term loan B is being done at Dole, while the term loan C is being done at Solvest Ltd., a wholly owned Bermuda subsidiary of Dole.

Recommitments were due at 3 p.m. ET on Friday and closing is targeted for the week of July 4.

Dole getting revolver

Dole's $1.25 billion senior secured credit facility also includes a $350 million multi-currency asset-based revolver.

Deutsche Bank Securities Inc., Bank of America Merrill Lynch and Wells Fargo Securities LLC are the lead banks on the deal that will be used to repay an existing asset-based revolver and Dole and Solvest term loan borrowings as well as for general corporate purposes.

Last year, Dole obtained a $1.2 billion credit facility, consisting of a $350 million four-year asset-based revolver and an $850 million seven-year term loan.

Pricing on the existing revolver is Libor plus 400 bps with no Libor floor, and the term loan is priced at Libor plus 325 bps with a 1.75% Libor floor and was sold at an original issue discount of 99.

Dole is a Westlake Village, Calif.-based fruit and vegetables company.

SunCoke readies deal

In more new deal happenings, SunCoke Energy scheduled a bank meeting for 10 a.m. ET on Tuesday in New York to launch a proposed $450 million credit facility that will be used to repay intercompany debt as part of its separation from Sunoco and for general corporate purposes, according to a market source.

The facility consists of a $150 million five-year revolver and a $300 million seven-year term loan B, the source said, adding that price talk is still to be determined.

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

As part of the separation, SunCoke plans on doing an initial public offering of common stock, and closing on the credit facility and the IPO is expected to occur at the same time.

SunCoke is a Lisle, Ill.-based producer of metallurgical coke.

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