Sensata, Hamilton, Blue Buffalo free up; Plains Exploration dips with acquisition news

By Sara Rosenberg

New York, Dec. 5 - Sensata Technologies BV, Hamilton Sundstrand Industrial and Blue Buffalo Co. all freed up for trading on Wednesday, and Plains Exploration & Production Co.'s term loan B headed lower as the company revealed that it is being acquired by Freeport-McMoRan Copper & Gold Inc.

Over in the primary, Patheon Inc. made some new updates to its term loan B, this time lifting the coupon and widening the original issue discount, and Pharmaceutical Research Associates Inc. (PRA) set spreads on its term loans and shortened maturities.

In addition, Atlas Iron Ltd. downsized its term loan, raised pricing and added a revolver to its structure, NXP Semiconductors NV accelerated the commitment deadline on its loan due to strong demand, while ContourGlobal Power Holdings SA removed its opportunistic deal from market.

Furthermore, CCC Information Services Inc. and Federal-Mogul Corp. set talk on their loans with launch, and ION Media Networks Inc. (Media Holdco LP) announced plans to bring a new deal to market and started going out with some guidance on the transaction.

Sensata starts trading

Sensata Technologies' roughly $1.085 billion repriced term loan made its way into the secondary market on Wednesday, with levels seen at par ¼ bid, par 5/8 offered, according to a market source.

Pricing on the loan is Libor plus 275 basis points with a 1% Libor floor, and the loan has 101 soft call protection for one year. With the repricing, the rate on the loan is being reduced from Libor plus 300 bps with a 1% Libor floor.

In addition, the company is amending its credit facility to eliminate the excess cash sweep for 2012, adjust the prepayment percentage grid, eliminate the Korean guarantors and include Belgian guarantors.

Morgan Stanley Senior Funding Inc. and Barclays Capital Inc. are the joint lead arrangers on the deal that is expected to close on Thursday.

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

Hamilton Sundstrand tops OID

Hamilton Sundstrand Industrial's credit facility began trading as well, with its $1.675 billion seven-year covenant-light term loan B quoted at par ¼ bid, 101¼ offered on the open and then it moved up to par ½ bid, 101½ offered, according to a trader.

Pricing on the term loan B is Libor plus 375 bps with a 1.25% Libor floor, and it was sold at a discount of 99.

During syndication, the B loan was upsized from $1.55 billion as the company's senior unsecured notes offering was downsized to $650 million from $775 million, and pricing was reduced from talk of Libor plus 400 bps to 425 bps.

The $1.975 billion senior secured deal (B1/B+) also includes a $300 million five-year revolver.

Hamilton being acquired

Proceeds from Hamilton Sundstrand's credit facility, bonds and equity will fund its acquisition by BC Partners and Carlyle Group from United Technologies Corp. for $3.46 billion.

Deutsche Bank Securities Inc., Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc., Morgan Stanley Senior Funding Inc., RBC Capital Markets LLC, UBS Securities LLC and Goldman Sachs & Co. are the lead banks on the credit facility.

Closing is expected this quarter, subject to regulatory approval and customary conditions.

Hamilton Sundstrand is a Windsor Locks, Conn.-based manufacturer of highly engineered, mission-critical pumps and compressors for the industrial, infrastructure and energy markets.

Blue Buffalo breaks

Blue Buffalo's $50 million add-on term loan B broke for trading too, with levels quoted at par bid, 101 offered, according to a trader.

Pricing on the add-on matches existing term loan B pricing at Libor plus 525 bps with a 1.25% Libor floor. The new debt was sold at par, after seeing its offer price tighten earlier this week from 991/2.

Proceeds from the add-on will be used to fund a dividend.

With the transaction, the company is amending its existing credit facility to allow for the upsize and dividend payment.

Lenders were offered a 12.5 bps amendment fee.

Citigroup Global Markets Inc. and Morgan Stanley Senior Funding Inc. are leading the deal.

Blue Buffalo is a Wilton, Conn.-based pet food company.

Plains Exploration softens

In more trading news, Plains Exploration's term loan B fell to par ¼ bid, par ¾ offered from par 5/8 bid, 101 1/8 offered during Wednesday's trading session on news of its purchase by Freeport-McMoRan, according to a trader.

Under the agreement, Freeport-McMoRan is buying Plains Exploration for about $6.9 billion in cash and stock, split between 0.6531 shares of Freeport-McMoRan common stock and $25 in cash per Plains Exploration share. Aggregate consideration to Plains Exploration shareholders is expected to consist of around $3.4 billion in cash and about 91 million shares of Freeport-McMoRan common stock.

The transaction is expected to close in the second quarter of 2013, subject to Plains Exploration shareholder approval, receipt of regulatory approvals and customary conditions.

Plains Exploration is a Houston-based oil and gas company. Freeport-McMoRan is a Phoenix, Ariz.-based mining company.

Freeport buying McMoRan

In addition to acquiring Plains Exploration, Freeport-McMoRan has agreed to buy McMoRan Exploration Co., a New Orleans-based explorer, developer and producer of natural gas and oil, for about $3.4 billion in cash, or $2.1 billion net of 36% of the interests currently owned by Freeport-McMoRan and Plains Exploration.

The transaction is subject to the McMoRan shareholder, receipt of regulatory approvals and customary conditions, and is expected to close in the second quarter of 2013.

To fund the two acquisitions Freeport-McMoRan has received a commitment for $9.5 billion in financing from JPMorgan Chase Bank, a news release said. This financing will also be used to repay Plains Exploration's term loans and revolver borrowings.

"We anticipate that attractive debt financing markets and our strong balance sheet will allow us to finance a significant portion of the transaction using low cost debt and enable FCX shareholders to retain the significant value we see in our existing asset base, while enhancing future value generation opportunities," Richard C. Adkerson, Freeport-McMoRan chief executive officer, added in the release.

Patheon flexes

Switching to the primary, Patheon raised pricing on its $565 million six-year term loan B to Libor plus 600 bps from talk of Libor plus 550 bps to 575 bps and moved the original issue discount to 97 from 981/2, according to a market source. As before, the loan has a 1.25% Libor floor and 101 soft call protection for one year.

Recommitments are due by noon ET on Thursday, the source added.

Earlier in the syndication process, the term loan B saw the addition of a 5.5 times net first-lien leverage ratio with a step-down to 4.25 times, incorporating a 35% covenant cushion, compared to originally being covenant-light.

Also, at that time, the maturity on the B loan was shortened to six years from seven years, the incremental facility was changed to $105 million plus additional amounts subject to 3.75 times first-lien leverage, from $140 million plus additional amounts subject to 4 times first-lien leverage, and the MFN pricing protection was revised to 50 bps for the life of the facility from 50 bps for 18 months.

Patheon lead banks

Morgan Stanley Senior Funding Inc., UBS Securities LLC, Credit Suisse Securities (USA) LLC and KeyBanc Capital Markets LLC are leading Patheon's $650 million senior secured credit facility (B3/B+) that also includes an $85 million revolver governed by the same financial covenant as the term loan B.

Proceeds, along with up to $30 million of equity from JLL Partners Fund V LP, will fund the $255 million acquisition of Banner Pharmacaps from VION NV, repurchase $280 million of existing senior secured notes, repay revolver borrowings and be used for general corporate purposes.

Closing is expected by year-end, subject to regulatory approvals and other customary conditions.

Patheon is a Durham, N.C.-based provider of contract development and manufacturing services to the pharmaceutical industry. Banner is a High Point, N.C.-based specialty pharmaceutical business dedicated to the research, development and manufacturing of gelatin-based dosage forms.

PRA updates structure

Pharmaceutical Research Associates nailed down pricing on its first-and second-lien term loans and revised maturities, and the plan is for allocations to go out on Thursday with closing taking place on Friday, according to a market source.

Pricing on the U.S. portion of the $335 million first-lien term loan (B1/B) came at Libor plus 525 bps the wide end of recent talk of Libor plus 500 bps to 525 bps talk, and wide of initial talk of Libor plus 400 bps to 425 bps, the source said. The tranche includes an up to $50 million equivalent euro carve-out priced at Euribor plus 550 bps.

As before, the first-lien term loan has a 1.25% Libor floor, an original issue discount of 99 and 101 soft call protection for one year.

The first-lien loan, which had been downsized earlier from $360 million, now matures in five years, as opposed to in six years, the source added.

PRA second-lien details

Pharmaceutical Research Associates' also set pricing on its $135 million second-lien term loan (Caa1/B-). The spread is Libor plus 900 bps after firming at the tight end of revised talk of Libor plus 900 bps to 925 bps talk but wide of initial talk of Libor plus 800 bps to 825 bps, the source continued.

Additionally, the second-lien loan now matures in 6½ years, versus its previously planned seven year maturity, the source added.

The second-lien loan still has a 1.25% Libor floor and an original issue discount of 98, and there is call protection of 103 in year one, 102 in year two and 101 in year three, which was changed a few days ago from 102 in year one and 101 in year two.

PRA getting revolver

Pharmaceutical Research Associates' $510 million senior secured credit facility also includes a $40 million revolver (B1/B) with a 50 bps unused fee.

UBS Securities LLC, Wells Fargo Securities LLC and GE Capital Markets are leading the deal.

Proceeds will be used to refinance existing debt and fund a dividend, the size of which was reduced to $124 million from $149 million when the first-lien term loan was downsized the other day.

Based off of Oct. 31 trailing 12-month EBITDA of $95.3 million, net first-lien leverage is 3 times and net total leverage is 4.4 times.

Pharmaceutical Research Associates is a Raleigh, N.C.-based clinical research organization.

Atlas Iron reworked

Atlas Iron made another round of revisions to its deal, downsizing the five-year first-lien covenant-light term loan (B2/B+) to $275 million from $325 million and raising pricing to Libor plus 750 bps from revised talk of Libor plus 700 bps and initial talk of Libor plus 550 bps, according to a market source.

Also, the original issue discount widened to 96 from 98 and the soft call protection was changed to 103 in year one, 102 in year two and 101 in year three, from just 102 in year one and 101 in year two, the source said. The 1.25% Libor floor was left unchanged.

With the term loan downsizing, an AUD 50 million revolver was added to the capital structure and the debt is being placed locally in Australia.

Credit Suisse Securities (USA) LLC is leading the deal that will be used for general corporate purposes and to fund the company's Horizon 1 expansion.

Allocations are targeted for Thursday and closing is expected by the end of the week.

Atlas is a Perth, Australia-based iron ore company.

NXP shutting early

NXP Semiconductors moved up the commitment deadline on its $500 million incremental senior secured term loan (B+) due January 2020 to the close of business on Wednesday from the close of business on Thursday on the back of strong demand for the deal, according to a market source.

The loan, which just launched with a call on Tuesday, is talked at Libor plus 350 bps with a 1.25% Libor floor and an original issue discount of 99 and is non-callable for one year, then has 101 hard call protection in year two.

Deutsche Bank Securities Inc., Bank of America Merrill Lynch and Goldman Sachs & Co are the bookrunners and lead arrangers on the deal. Barclays is the administrative agent.

Proceeds will fund a tender for up to $500 million of the company's 9¾% senior secured notes due 2018. As of Nov. 20, investors had tendered $678.02 million, or 73.5%, of the notes. The tender offer expires on Dec. 10.

NXP is an Eindhoven, Netherlands-based maker of semiconductors.

ContourGlobal pulls deal

ContourGlobal Power withdrew its $350 million five-year first lien term loan (B2/BB-) from market as the deal was opportunistic and the company didn't like the terms that were needed for it to clear, a source told Prospect News.

Price talk on the loan was Libor plus 850 bps with a 1.5% Libor floor and an original issue discount of 971/2, and the debt was non-callable for two years, then at 102 in year three and 101 in year four.

Credit Suisse Securities (USA) LLC was leading the deal that was going to be used to finance acquisitions and for general corporate purposes.

ContourGlobal is a New York-based operator of power generating stations.

CCC talk emerges

Also on the new deal front, CCC Information Services held a bank meeting on Wednesday to launch its credit facility, and with the event, price talk surfaced, according to a market source.

The $470 million seven-year covenant-light term loan is talked at Libor plus 425 bps with a 1.25% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, the source said.

The company's $520 million senior secured credit facility (B1) also includes a $50 million five-year revolver.

Goldman Sachs & Co. and J.P. Morgan Securities LLC are leading the deal that will be used with mezzanine financing to fund the company's buyout by Leonard Green & Partners from Investcorp.

CCC is a Chicago-based provider of advanced software and workflow tools to the insurance automotive claims and collision repair industries.

Federal-Mogul extension

Federal-Mogul launched its term loan B amendment and extension proposal with a call in the morning, under which it is looking to push out the maturity on about $1.2 billion of its roughly $1.8 billion term loan B to January 2017 from December 2014 at pricing of Libor plus 375 bps, versus non-extended pricing of Libor plus 193.75 bps, according to a market source.

Lenders are being offered a 2.5 bps consent fee and a 10 bps extension fee, the source said.

Additionally, the company is looking to increase its asset-based revolver and extend the maturity.

J.P. Morgan Securities LLC and Wells Fargo Capital Finance LLC are the lead banks on the deal that is expected to close this quarter, and have each committed $125 million to the revolver.

The amendment and extension is conditioned on the prepayment of up to $300 million of the extended term loan, and to raise those funds, the company entered into an agreement to issue about $150 million of common stock to Icahn Enterprises LP and will commence a subsequent rights offering of $150 million to shareholders of record.

Federal-Mogul is a Southfield, Mich.-based supplier of powertrain and safety technologies.

ION Media coming soon

ION Media emerged with new deal plans, setting a conference call for 11 a.m. ET on Thursday to launch a new $255 million 51/2-year term loan B (BB-) that is being guided at Libor plus 550 bps to 575 bps with a 1.25% Libor floor and an original issue discount that is still to be determined, according to a market source.

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

ION, a television broadcast network, will use the term loan to fund an equity repurchase of minority investors.

Nexstar closes

In other news, Nexstar Broadcasting Group Inc. closed on its $450 million senior secured credit facility (Ba2/BB) that consists of a $100 million five-year revolver ($35 million at Mission Broadcasting Inc., $65 million at Nexstar) and a $350 million seven-year term loan ($104 million at Mission, $246 million at Nexstar), according to an 8-K filed with the Securities and Exchange Commission.

Revolver pricing is Libor plus 425 bps.

Pricing on the term loan is Libor plus 350 bps with a 1% Libor floor, and it was sold at a discount of 99½ after firming during syndication at the tight end of the 99 to 99½ talk. When the discount was set, a step-down to Libor plus 325 bps at less than 4.75 times leverage was added.

Bank of America Merrill Lynch, UBS Investment Bank and RBC Capital Markets led the deal that was used to fund the acquisition by Nexstar and Mission Broadcasting of 12 television stations from Newport Television LLC for $285.5 million, to refinance existing bank debt and to redeem notes.

Nexstar is an Irving, Texas-based media company. Mission is a Brecksville, Ohio-based television station group.

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