Gibson frees up; Formula sets terms, adds ticking fee; CAMP, VWR Funding rework pricing

By Sara Rosenberg

New York, May 18 - Gibson Energy ULC's term loan B made its way into the secondary market on Friday, with levels quoted above its original issue discount price, and Tronox Inc.'s term loan was a bit stronger as the company reported first-quarter results.

Moving to the primary, Formula One finalized pricing on its term loan B, with the spread coming at the high end and the original issue discount coming wide of the unofficial whispered talk, and a ticking fee was added to the debt as well.

Also, CAMP International Holding Co. cut the spread on its term loans and accelerated the commitment deadline, and VWR Funding Inc. raised the coupon on its proposed extended debt, while leaving amendment and extension fees unchanged.

Gibson Energy breaks

Gibson Energy's $650 million term loan B (Ba3/BB-) due June 2018 was free to trade on Friday afternoon, with levels quoted at 99¾ bid, par ¼ offered, according to a trader.

Pricing on the loan is Libor plus 375 basis points with a 1% Libor floor, and it was sold at an original issue discount of 991/2. There is 101 soft call protection through June 2013.

Proceeds will be used to refinance an existing roughly $650 million term loan due June 2018 that was done in June 2011 at pricing of Libor plus 450 bps with a 1.25% Libor floor and was sold at an original issue discount of 99. This debt included 101 soft call protection for two years.

With the refinancing, the company was seeking an up to $100 million add-on to its revolver (Ba3/BB-) for general corporate purposes.

J.P. Morgan Securities LLC, UBS Securities LLC and Citigroup Global Markets Inc. are the lead banks on the deal.

Gibson is a Calgary, Alta.-based midstream energy company.

Tronox rises

Tronox's term loan moved up to 98¾ bid, 99¾ offered from 98½ bid, 99½ offered with the release of first-quarter numbers, according to a trader.

However, the trader pointed out that during Thursday's session, the debt had lost a point and a half because of general market weakness, so Friday's move could have just been a small rebound from the loss.

For the quarter, Tronox reported net income of $86.3 million, or $5.48 per diluted share, compared to net income of $10.2 million, or $0.65 per share, for the successor in the two months ended March 31, 2011 and net income of $631.3 million, or $15.25 per diluted share, for the predecessor for the month of Jan. 31, 2011.

Net sales for the quarter were $433.6 million, compared to $267.1 million for the successor's two months last year and $107.6 million for the predecessor's one month last year.

And, adjusted EBITDA for the quarter was $151.4 million, versus $68.1 million at the successor in the two months ended March 31, 2011, and $24.3 million for the predecessor for January 2011.

Tronox plans debt

With its earnings news, Tronox announced that management plans to recommend to the board of directors that additional debt be raised of between $750 and $1 billion through new term loans and/or unsecured bonds shortly after the completion of the acquisition of Exxaro Resources Ltd.'s mineral sands operations.

Other potential recommendations for the deployment of capital in the future include declaring a special dividend of $25 per share and authorizing up to $250 million of share repurchases.

Also, management would like to adopt a regular quarterly dividend starting in the fourth quarter.

The company went on to say in its news release that these recommendations are subject to a number of factors, including the availability of financing, the performance of the combined business, and the cash needs of the combined business.

Tronox is an Oklahoma City-based producer and marketer of titanium dioxide pigment.

Formula One pricing

Switching to the primary, Formula One nailed down pricing on its $1.3 billion six-year term loan B at Libor plus 350 bps with a 1% Libor floor and an original issue discount of 98, versus prior unofficial guidance of Libor plus 325 bps to 350 bps with a 1% Libor floor and a discount of 99, a market source said. There is still 101 soft call protection for one year.

Also, a ticking fee of 100 bps per annum was added to the term loan B that will be in effect until the company completes its initial public offering of stock, which is a condition to closing on the credit facility, or the credit agreement commitment termination date is reached, the source remarked.

Books on the deal closed on Friday, with it reaching oversubscription levels.

Allocations on the company's $1.8 billion credit facility - that also includes a $50 million five-year revolver and a $450 million five-year term loan A - are hoped to go out on Monday, the source added.

Formula One lead banks

Goldman Sachs & Co., RBS Securities Inc., Morgan Stanley Senior Funding Inc. and UBS Securities LLC are the lead banks on Formula One's credit facility.

Proceeds will be used to refinance existing debt, including the credit facility that was just completed in April.

The existing facility consists of a $1,383,000,000 term loan B priced at Libor plus 450 bps with a 1.25% Libor floor that was sold at an original issue discount of 99, an $817.5 million term loan C priced at Libor plus 500 bps with a 1.25% Libor floor, and a $70 million revolver.

Formula One is the organizer of the Formula One World Championship (F1) and owner of the commercial rights to F1 motorsports racing.

CAMP tweaks spreads

CAMP International revised pricing lower on its first- and second-lien term loans as a result of strong demand, and moved up the commitment deadline to Monday from Thursday, according to a market source.

The $230 million seven-year covenant-light first-lien term loan (B1/B) is now priced at Libor plus 525 bps, down from Libor plus 550 bps, and a step-down was added to Libor plus 500 bps if first-lien net leverage is less than 4 times, the source said. The 1.25% Libor floor, original issue discount of 99 and 101 soft call protection for one year were left unchanged.

As for the $115 million 71/2-year covenant-light second-lien term loan (Caa2/CCC+), it is now priced at Libor plus 875 bps, down from Libor plus 900 bps, with the 1.25% Libor floor and original issue discount of 98 staying the same, the source continued. The debt has call protection of 103 in year one, 102 in year two and 101 in year three.

CAMP revises deadline

With the changes to pricing, CAMP International changed the commitment deadline on its credit facility to the end of day Monday from Thursday, the source said.

The $375 million deal also provides for a $30 million five-year revolver (B1/B).

Deutsche Bank Securities Inc., Credit Suisse Securities (USA) LLC, RBC Capital Markets and UBS Securities LLC are the lead banks on the facility that will be used to help fund the acquisition of the company by GTCR from Warburg Pincus.

CAMP International is a Ronkonkoma, N.Y.-based provider of maintenance tracking for business aviation.

VWR flexes

VWR Funding lifted pricing on its proposed extended term loan to Libor plus 425 bps from Libor plus 350 bps and set the commitment deadline for Tuesday, according to a market source. Non-extended U.S. term loan pricing is Libor plus 250 bps.

The company is asking to extend its term loan (B1) to April 2017 from June 2014.

As before, the loan has 101 soft call protection for one year, and lenders are being offered a 10 bps consent fee and a 15 bps extension fee.

Bank of America Merrill Lynch is the lead bank on the deal.

VWR is a West Chester, Pa.-based provider of laboratory equipment to the pharmaceutical, biotechnology, chemical and other industries.

Applied readies allocations

Meanwhile, Applied Extrusion Technologies Inc. is hoping to allocate its $143 million five-year credit facility during the week of May 21 after firming a flex in pricing to Libor plus 350 bps from Libor plus 400 bps, according to a market source. Closing is anticipated by the end of the month.

With the change in spread, the upfront fee was revised to 50 bps, from initial talk of 50 bps to 75 bps based on commitment size, the source added.

The GE Capital Markets-led deal includes a $30 million revolver and a $113 million term loan A.

Proceeds will be used to help fund the purchase of the company by Taghleef Industries.

Applied Extrusion is a Wilmington, Del.-based supplier of specialized oriented polypropylene films used primarily in flexible packaging for food, product labeling, and non-food applications. Taghleef is a Dubai-based developer, manufacturer and marketer of films for snacks, confectionery, bakery/biscuits, fresh produce packaging as well as for labeling and adhesive tapes.

Clearwater sees interest

Clearwater Seafoods Inc.'s C$275 million credit facility has seen momentum building, a market source told Prospect News, adding that the recent interest has sparked optimism that the deal will get done at initial terms.

The facility consists of a C$65 million asset-based revolver that is available in U.S. and Canadian dollars, a C$75 million term loan A (B1) and a C$135 million term loan B (B1) that is primarily expected to be funded in U.S. dollars since the targeted institutions in the syndication process are in the U.S. market.

Price talk on the B loan is Libor plus 500 bps with a 1.25% Libor floor and an original issue discount of 99.

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

Clearwater is a Bedford, N.S.-based seafood company and holder of shellfish licenses and quotas.

Applied Systems holds call

Applied Systems Inc. launched with a conference call on Friday an $85 million add-on first-lien term loan due March 2016 that is being talked at Libor plus 400 bps with a 1.5% Libor floor and an original issue discount of 98, according to sources.

Credit Suisse Securities (USA) LLC is the lead bank on the deal that will be used to fund an acquisition.

The company is also seeking an amendment to its existing credit facility to allow for the new debt and the acquisition, sources added.

Commitments are due on May 29.

Applied Systems is a University Park, Ill.-based provider of agency and brokerage management software.

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