Chemtura softens with add-on; CNO, Burger King, Payless, Par Pharmaceutical set talk

By Sara Rosenberg

New York, Sept. 7 - Chemtura Corp.'s term loan headed lower in the secondary market on Friday as the company said that it will be getting an add-on to the tranche.

Switching to the primary, CNO Financial Group Inc., Burger King Corp. and Payless ShoeSource/Collective Licensing International announced talk with their launches, and Par Pharmaceutical Cos. Inc. revealed guidance on its term loan on the back of ratings being released.

Furthermore, ConvaTec Inc. and U.S. Xpress Enterprises Inc. announced plans for new deals and began circulating some price talk, and New Breed Logistics Inc. and Station Casinos LLC disclosed that they will be coming to market shortly with new credit facilities.

Chemtura slides

Chemtura's term loan was weaker in trading on Friday on news of an up to $125 million add-on senior secured term loan that is being done under an existing credit facility accordion feature, according to a trader.

The term loan was quoted at par ¼ bid, 101¼ offered, down from par ¾ bid, 101½ offered, the trader said.

The add-on, which will be launched with a call at 11 a.m. ET on Monday, is being talked at Libor plus 400 basis points with a 1.5% Libor floor and a par offer price, a market source said. The spread and floor are in line with pricing on the existing term loan, which is fungible with the new debt.

Bank of America Merrill Lynch, Citigroup Global Markets Inc. and Wells Fargo Securities LLC are leading the deal that will be used to fund potential bolt-on investment opportunities and for general corporate purposes.

Chemtura is a Middlebury, Conn.-based manufacturer and marketer of specialty chemicals, agrochemicals and pool, spa and home care products.

CNO guidance emerges

Over in the primary, CNO Financial held a bank meeting on Friday morning to kick off syndication on its credit facility, and with the event, price talk on its term loans was announced, according to a market source.

The $250 million four-year term loan B-1 is talked at Libor plus 350 bps with a 1% Libor floor, an original issue discount of 99 to 99½ and 101 soft call protection for one year, the source said. This tranche amortizes at a rate of 20% in years one and two, and 30% in years three and four.

As for the $400 million six-year term loan B-2, talk is Libor plus 400 bps to 425 bps with a 1.25% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, the source continued. Amortization is 1% per year.

Commitments are due on Sept. 21.

CNO getting revolver

CNO Financials's $700 million credit facility (Ba3/B+) also provides for a $50 million three-year revolver that is expected to be unfunded at close.

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

Proceeds, along with $250 million of new senior secured notes due 2020 and cash on hand, will repay all $224 million outstanding under the company's existing senior secured credit facility, repurchase up to $275 million of 9% senior secured notes due 2018 for about $323 million and repurchase about $200 million of 7% convertible senior debentures due 2016 from Paulson & Co. for around $334 million.

Closing is targeted for late September.

CNO is a Carmel, Ind.-based insurance company.

Burger King launches

Burger King launched its term loan B due 2019, the size of which is still to be determined, with guidance of Libor plus 300 bps with a 1% Libor floor and an original issue discount of 993/4, according to a market source.

The company is also getting a term loan A due 2017, with sizing also to be determined.

J.P. Morgan Securities LLC, Barclays and Bank of America Merrill Lynch are leading the deal that will be used to refinance about $1.73 billion of existing term loan B borrowings.

Burger King is a Miami-based fast food hamburger chain.

Payless pricing

Payless/Collective came out with talk of Libor plus 600 bps to 625 bps with a 1.25% Libor floor, an original issue discount of 98 to 99 and 101 soft call protection for one year on its $275 million term loan (B1/B) that launched on Friday as well, according to a market source.

Commitments are due on Sept. 19.

Morgan Stanley Senior Funding Inc., Jefferies & Co. and KKR Capital Markets are leading the deal that will be used to help fund the purchase of the company by Blum Capital Partners and Golden Gate Capital from Collective Brands Inc.

In addition, the company is getting a $250 million senior secured asset-based revolving credit facility from Wells Fargo Capital Finance.

Closing is expected late in the third quarter or early in the fourth quarter.

Payless, a specialty family footwear retailer, will continue to have headquarters in Topeka, Kan., and Collective Licensing, a development and licensing company, will remain based in Englewood, Colo.

Par Pharmaceutical talk

Par Pharmaceutical released talk on its $980 million term loan early in the morning as ratings on the loan emerged at B1/B+ on Thursday evening, according to a market source.

The term loan is talked at Libor plus 425 bps to 450 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 $1.13 billion senior secured credit facility also includes a $150 million revolver (B1/B+) that has been put away with the arrangers, the source continued.

Bank of America Merrill Lynch, Deutsche Bank Securities Inc., Goldman Sachs & Co., RBC Capital Markets LLC and Citigroup Global Markets Inc. are leading the deal, which launched with a bank meeting on Thursday.

Par Pharmaceutical buyout

Proceeds from Par Pharmaceutical's credit facility and $490 million of bonds will fund its purchase by TPG for $50 per share in cash, or about $1.9 billion.

The notes are backed by a commitment for a $490 million senior unsecured bridge loan.

Closing is subject to shareholder approval, which will be sought at a special meeting on Sept. 27, clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, which has already been received, and other customary conditions. It is not subject to a financing condition.

Par Pharmaceutical is a Woodcliff Lake, N.J.-based specialty pharmaceutical company.

ConveTec joins calendar

ConvaTec will be holding a conference call at 11 a.m. ET on Monday to launch a $300 million term loan B-2 due 2016 that is talked at Libor plus 425 bps with a 1.5% Libor floor and an original issue discount that is still to be determined, according to a market source.

The maturity, spread and floor match that of the existing term loan B, the source said.

J.P. Morgan Securities LLC is the leading the deal that will be used to fund the $321 million acquisition of 180 Medical Holdings Inc., an Oklahoma City-based provider of disposable, intermittent catheters and urologic medical supplies.

Closing is expected late in the third quarter, subject to regulatory approval and customary conditions.

With the news, ConvaTec's existing term loan B was quoted at par ¼ bid, par ¾ offered, versus prior levels of par bid, par ¾ offered, a trader added.

ConvaTec is a Skillman, N.J.-based developer and marketer of medical technologies.

U.S. Xpress plans refi

U.S. Xpress Enterprises set a bank meeting for Thursday in New York to launch a $230 million credit facility that will be used to refinance existing bank debt, according to a market source.

The facility consists of a $40 million three-year revolver and a $190 million four-year term loan B, with both tranches talked at Libor plus 600 bps, the source said. The term loan B has a 1.5% Libor floor and an original issue discount that is expected in the 97½ to 98 area. The revolver has a 50 bps unused fee.

SunTrust Robinson Humphrey Inc. is the lead bank on the deal.

Total leverage is slightly over 4 times, the source added.

U.S. Xpress is a Chattanooga, Tenn.-based truckload carrier and a diversified provider of Truckload, intermodal and logistics services.

New Breed readies deal

Also on the topic of the forward calendar, New Breed Logistics scheduled a bank meeting for 9:30 a.m. ET on Tuesday in New York to launch a $350 million senior secured credit facility that consists of a $50 million five-year revolver and a $300 million seven-year term loan B, according to a market source.

Morgan Stanley Senior Funding Inc., Bank of America Merrill Lynch, RBC Capital Markets LLC and Wells Fargo Securities LLC are leading the deal that will be used to refinance existing debt and fund a sponsor dividend.

New Breed is a High Point, N.C.-based third-party logistics services provider.

Station coming soon

Additionally, Station Casinos will hold a bank meeting at 1:30 p.m. ET on Monday to launch a $775 million senior secured credit facility that consists of a $200 million five-year revolver and a $575 million seven-year term loan B, according to a market source.

The actual co-borrowers on the deal are Station Casinos NP Opco LLC & Station GVR Acquisition LLC.

Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and J.P. Morgan Securities LLC are leading the transaction that will be used to refinance existing debt at Opco and GVR.

Station Casinos is a Las Vegas-based casino company.

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