FairPoint, Orbitz stregthen with earnings; PRV Aerospace, Harbor Freight revise deals

By Sara Rosenberg

New York, May 3 - FairPoint Communications Inc.'s term loan saw considerable improvement in the secondary market on Thursday as the company posted favorable quarterly results, and Orbitz Worldwide Inc. was better with earnings as well.

Switching to the primary, PRV Aerospace LLC made some new changes to its credit facility, this time flexing pricing lower, tightening the Libor floor and moving the original issue discount back to where it initially launched, and Harbor Freight Tools USA Inc. revised the coupon and maturity on its term loan.

In addition, Arch Coal Inc. released original issue discount guidance with its launch during the session, and Misys plc disclosed price talk on its credit facility as the European launch for the deal took place.

Also, Grohe AG, Clearwater Seafoods Inc. and Beasley Broadcast Group Inc. all came out with guidance on their upcoming deals, RGIS LLC surfaced with amend/extend and incremental loan plans, and Esselte joined next week's calendar with a new term loan.

FairPoint trades up

Fairpoint Communications' term loan jumped to 86 bid, 87 offered from 84½ bid, 85½ offered in trading on Thursday following the release of first quarter numbers that investors found to be positive, according to a trader.

For the quarter, the company reported a net loss of $46.7 million, versus a net loss of $84 million in the fourth quarter of 2011 and net income of $562.5 million in the first quarter of 2011, when the company recorded cancellation of debt income associated with its emergence from bankruptcy.

Revenue for the quarter was $248.5 million, compared to $254.2 million in the previous quarter and $254.8 million in the first quarter of 2011.

And, consolidated EBITDAR was $55.3 million in the first quarter, versus $70 million in the prior quarter and $49.1 million in the 2011 first quarter.

FairPoint is a Charlotte, N.C.-based communications provider of broadband internet access, local and long-distance phone, television and other high-capacity data services.

Orbitz heads higher

Orbitz's term loan was also stronger with first-quarter numbers, as its net loss lessened from a year ago and revenues grew, according to traders.

One trader had the loan quoted at 97¾ bid, 99¼ offered, up from 94½ bid, 96½ offered, and a second trader had the loan at 98 bid, 99 offered, up on the bid side from 97 bid, 99 offered.

For the first quarter, the company reported a net loss of $6.5 million, or $0.06 per diluted share, compared with a net loss of $10.9 million, or $0.11 per diluted share, for the first quarter 2011.

Net revenue for the quarter was $189.8 million, up 3% from $184.9 million in the prior year.

And, adjusted EBITDA was $20.6 million, up 19% from $17.3 million in the 2011 quarter.

Additionally, the Chicago-based online travel company said that in March, it made a $32.2 million payment on its term loan based on excess cash flow for full year 2011, as required under the credit agreement.

PRV reworked again

Over in the primary, PRV Aerospace came out with a second round of changes to its $220 million credit facility, setting pricing at Libor plus 525 bps with a 1.25% Libor floor and an original issue discount of 99 and adding 101 soft call protection for one year to the term loan, according to a market source.

Most recently, the facility had been talked at Libor plus 550 bps with a 1.5% floor and a discount of 981/2, and prior to that, it had been talked at Libor plus 475 bps with a 1.5% floor and a discount of 99.

The deal is comprised of a $30 million five-year revolver and a $190 million six-year term loan.

Lead banks GE Capital Markets and KeyBanc Capital Markets were asking for recommitments by the end of the day on Thursday.

Proceeds will be used to help fund the buyout of the Everett, Wash.-based aerospace and defense group by Court Square Capital Partners from Platte River Ventures.

Harbor Freight tweaks deal

Harbor Freight Tools is now talking its $1 billion first-lien term loan (B1/B+) at Libor plus 425 bps, up from Libor plus 400 bps previously, and the maturity is being shortened to 5½ years from seven years, according to a market source.

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

The company's $1.4 billion credit facility, which also includes a $400 million ABL revolver, will used to refinance existing debt and pay a dividend.

Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and Wells Fargo Securities LLC are leading the term loan, and Wells Fargo is leading the revolver.

Harbor Freight, a Camarillo, Calif.-based provider of tools and equipment, will have total leverage of 3.7 times.

Arch Coal OID

In more primary news, Arch Coal announced original issue discount of 98½ to 99 on its $1 billion six-year covenant-light senior secured term loan (Ba2/BB/BB) in connection with its launch on Thursday, according to a market source.

The loan is talked at Libor plus 450 bps with a 1.25% Libor floor, which matches what the company recently outlined in a regulatory filing, and there is call protection of 102 in year one and 101 in year two, sources said. Up to $500 million in asset sales will be allowed to repay the term loan at par within 18 months from closing.

Bank of America Merrill Lynch, PNC Capital Markets LLC, Morgan Stanley Senior Funding Inc., Citigroup Global Markets Inc., RBS Securities Inc., BMO Capital Markets Corp. and Union Bank are leading the deal.

Commitments are due on May 10.

Arch Coal repaying debt

Proceeds from Arch Coal's credit facility will be used to fund a tender offer that expires on May 29 for $450 million of 6¾% senior notes due 2013 at Arch Western Finance LLC, to pay down revolver borrowings and to provide additional liquidity.

With this transaction, the company's lenders have agreed to amend the existing senior secured revolver to allow for the new term loan, reduce revolver borrowing capacity to $1 billion and provide relief from certain financial covenants over the next two years.

PNC is the lead bank on the revolver.

Arch Coal is a St Louis-based coal producer and marketer.

Misys guidance emerges

Misys held a bank meeting in London to launch its roughly $1.18 billion credit facility, and with the event, price talk came out, market sources said. A bank meeting will be held in New York on Monday to kick off the U.S. syndication.

The $125 million five-year revolver and $730 million seven-year first-lien term loan are both talked at Libor plus 500 bps to 525 bps, and the €250 million seven-year first-lien term loan is talked at Euribor plus 550 bps to 575 bps, sources said.

The revolver has a 50 bps unused fee and a 100 bps upfront fee, and the term loans have a 1.25% floor, 101 soft call protection for one year and an original issue discount of 99, sources continued.

Commitments are due on May 18.

Misys lead banks

Credit Suisse Securities (USA) LLC, Bank of America Merrill Lynch and Jefferies Finance LLC are leading Misys' credit facility.

Prior to launch, it was thought that the revolver would be sized at $100 million, and it was known that the term loan would be $1.06 billion in total, but the breakdown of the euro and U.S. tranches was unavailable.

However, the company has said that if the deal was rated, the first-lien term loan split would be $533 million and €400 million, and if it was not rated, the split would be $730.6 million and €250 million.

Also, while official talk had not been out previously, the company had disclosed that it expected revolver pricing at Libor plus 425 bps with a 50 bps unused fee, U.S. term loan pricing at Libor plus 450 bps with a 1.25% floor and euro term loan pricing at Euribor plus 500 bps with a 1.25% floor.

Misys being acquired

Proceeds from Misys' credit facility will be used to help its purchase by Vista Equity Partners for 350p per share and to refinance certain debt. The transaction values the entire existing and to be issued ordinary share capital of the company at around £1.27 billion.

In addition to the first-lien credit facility, the company has received a commitment for a $615 million 71/2-year unsecured term loan for the buyout, and plans on using equity as well.

According to the company, expected pricing on the unsecured loan is 9%, and the tranche would be non-callable for three years, then at 106¾ in 2015, 104½ in 2016 and 102¼ in 2017.

Misys is a London-based application software and services provider servicing the financial services industry.

Grohe floats talk

Grohe revealed talk of Libor/Euribor plus 550 bps with a 1.25% floor and an original issue discount of 98½ on its €300 million first-lien covenant-light term loan that is set to launch with a bank meeting in New York on Friday, according to a market source.

The company already held a bank meeting in London on Wednesday to launch the loan to European investors.

The term loan will have U.S. and euro components, and the current expectation is for a breakdown of $250 million and €100 million, the source remarked.

Credit Suisse Securities (USA) LLC, Morgan Stanley Senior Funding Inc. and Deutsche Bank Securities Inc. are leading the deal that will be used refinance floating-rate notes.

Grohe is Düsseldorf, Germany-based manufacturer and supplier of sanitary fittings.

Clearwater term B pricing

Also on the topic of talk, Clearwater Seafoods began floating guidance on its C$135 million term loan B (B1) at Libor plus 500 bps with a 1.25% Libor floor and an original issue discount of 99 ahead of its Friday bank meeting, according to a market source.

The B loan is primarily being marketed to U.S. investors, and is therefore expected to mostly be funded in U.S. dollars.

The company's C$275 million credit facility also provides for a C$65 million asset-based revolver that is available in U.S. and Canadian dollars and a C$75 million term loan A (B1).

GE Capital Markets and BMO Capital Markets are leading the deal that will be used to refinance existing debt facilities.

Clearwater, a Bedford, Nova Scotia-based seafood company and holder of shellfish licenses and quotas, is seeking commitments towards the facility by May 18, the source added.

Beasley readies deal

Meanwhile, Beasley Broadcast scheduled a bank meeting for May 10 to launch a proposed $150 million credit facility and released talk on the transaction at Libor plus 500 bps with a 1.25% Libor floor and an original issue discount of 99, according to a market source.

The facility consists of a $20 million five-year revolver and a $130 million six-year term loan B, the source said.

GE Capital Markets is the lead bank on the deal that will be used to refinance existing debt.

Beasley is a Naples, Fla.-based radio broadcasting company.

RGIS sets call

RGIS is planning on holding a conference call at 2 p.m. ET on Friday to launch a $215 million incremental loan (B2/B+) that will be used to pay down mezzanine debt, according to a market source.

In addition, the company will launch an amendment and extension proposal under which it is looking to extend its existing term loan to October 2016 from April 2014, the source said.

Goldman Sachs & Co., J.P. Morgan Securities LLC, Natixis and Wells Fargo Securities LLC are the lead banks on the deal.

RGIS is an Auburn Hills, Mich., inventory and retail services company.

Esselte coming soon

Also coming up is a $200 million term loan for Esselte that is scheduled to launch with a bank meeting on Monday afternoon, according to a market source.

Price talk is not yet available, the source said.

Jefferies & Co. and Citigroup Global Markets Inc. are the lead banks on the deal that will be used to refinance existing debt and fund a distribution to shareholders.

Esselte is a Stamford, Conn.-based office supplies manufacturer.

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