MedAssets, Pinnacle Foods, 1-800 Contacts, Sarnova price talk surfaces

By Sara Rosenberg

New York, Jan. 6 – In the loan primary market on Wednesday, MedAssets Inc., Pinnacle Foods Inc., 1-800 Contacts Inc. (CNT Holdings III Corp.) and Sarnova Inc. all released price talk on their new deals in connection with their launches.

MedAssets discloses terms

MedAssets hosted its bank meeting on Wednesday and released price talk on its first- and second-lien term loans, according to a market source.

The $1.13 billion 6.5-year first-lien covenant-light term loan (B2/B) is talked at Libor plus 475 basis points to 500 bps with a 1% Libor floor, an original issue discount of 99, with an additional 50 bps fee if the credit facility has not been repaid within six months of closing, and 101 soft call protection for six months, the source said.

And, the $500 million seven-year second-lien covenant-light term loan (Caa2/CCC+) is talked at Libor plus 950 bps with a 1% Libor floor, a discount of 97 and call protection of non-callable for one year, then at 103 in year two and 101 in year three or par for 12 months for any prepayments with proceeds of the SCM divestiture, the source continued.

The company’s $1.73 billion senior secured credit facility also includes a $100 million five-year revolver (B2/B).

First-lien leverage is 4.5 times, and total leverage is 6.5 times.

Commitments are due by 5 p.m. ET on Jan. 21, the source added.

MedAssets lead banks

Barclays, Morgan Stanley Senior Funding Inc., Macquarie Capital (USA) Inc. and Golub Capital Markets LLC are leading MedAssets’ credit facility.

Proceeds will be used with about $1,238,000,000 in equity to fund the buyout of the company by Pamplona Capital Management for $31.35 per share, or about $2.7 billion.

Pamplona has entered into a separate agreement with VHA-UHC Alliance NewCo Inc., a member-owned health care company, to divest MedAssets’ Spend and Clinical Resource Management segment to VHA-UHC Alliance following the completion of Pamplona’s acquisition of MedAssets.

MedAssets’ Revenue Cycle Management segment will be combined with Precyse, a Pamplona-owned company that provides health information management services, technology and education.

Closing is expected this quarter, subject to regulatory approvals, expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, MedAssets’ stockholder approval and other customary conditions.

MedAssets is an Alpharetta, Ga.-based health care performance improvement company.

Pinnacle Foods guidance

Pinnacle Foods launched on its lender call a $550 million incremental term loan (Ba2/BB+) talked in the Libor plus 350-bps area with a 0.75% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, a source said.

The company had received a commitment for an up to $900 million incremental term loan but approached lenders with a smaller term loan, since it is planning on issuing $350 million of notes, the source continued.

Bank of America Merrill Lynch, Barclays and Credit Suisse Securities (USA) LLC are leading the loan that will be used with the bonds and cash on hand to fund the acquisition of Boulder Brands Inc. for $11.00 per share, in a transaction valued at about $975 million, including around $265 million of net debt.

Closing is expected this quarter, subject to customary conditions.

Pinnacle Foods is a Parsippany, N.J.-based producer, marketer and distributor of branded food products. Boulder Brands is a Boulder, Colo.-based manufacturer of a portfolio of health and wellness brands.

1-800 Contacts sets talk

1-800 Contacts held its bank meeting in the morning and, shortly before the event kicked off, talk on its $500 million seven-year first-lien term loan surfaced at Libor plus 450 bps to 475 bps with a 1% Libor floor, an original issue discount of 98.5 to 99 and 101 soft call protection for six months, a market source remarked.

The company’s $580 million credit facility (B1/B) also includes an $80 million five-year revolver.

Commitments are due at 5 p.m. ET on Jan. 20.

Credit Suisse Securities (USA) LLC, Barclays and Deutsche Bank Securities Inc. are leading the debt that will be used to help fund AEA Investors LP’s acquisition of a majority interest in the company from Thomas H. Lee Partners LP, who will remain a significant shareholder in the company.

1-800 Contacts is a Draper, Utah-based retailer of contact lenses.

Sarnova comes to market

Sarnova launched on its lender call during the session a $215 million six-year first-lien term loan talked at Libor plus 475 bps with a 1% Libor floor and an original issue discount of 99, according to a market source.

The company’s credit facility also includes a $40 million revolver and a $120 million second-lien term loan that has already been placed, the source said.

Commitments are due on Jan. 20.

Capital One is leading the deal that will be used to refinance existing debt.

Sarnova is a Dublin, Ohio-based medical sales and distribution company.

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