Alion Science frees up; Epicor updates terms; First Brands lifts loan size; Ryan accelerated

By Sara Rosenberg

New York, July 22 – Alion Science & Technology Corp.’s first-lien term loan made its way into the secondary market on Wednesday morning, with levels quoted above its original issue discount.

Moving to the primary market, Epicor Software Corp. finalized the original issue discount on its first-lien term loan at the tight side of guidance, and set the spread on its second-lien term loan at the low end of talk while tightening the discount price.

Also, First Brands Group LLC increased the size of its incremental first-lien term loan, Ryan Specialty Group LLC accelerated the commitment deadline for its term loan B, and Graham Packaging Co. Inc. and ProMach Group Inc. released price talk on their term loans with launch.

Alion starts trading

Alion Science & Technology’s $360 million four-year first-lien term loan (B1/BB-) broke for trading on Wednesday morning at 99½ bid, par ¼ offered after allocating on Tuesday, a market source said.

Pricing on the term loan is Libor plus 375 basis points with a 1% Libor floor and it was sold at an original issue discount of 99. The debt has 101 soft call protection for six months.

During syndication, the spread on the term loan was reduced from Libor plus 400 bps.

Along with the term loan, the company is getting a $40 million revolver (Ba1/BB).

UBS Investment Bank and KKR Capital Markets are leading the deal that will be used with cash on hand to refinance an existing first-lien term loan and mezzanine tranche.

Alion, a portfolio company of Veritas Capital, is a McLean, Va.-based provider of advanced engineering, intelligence surveillance and reconnaissance, research development test and evaluation, live virtual and constructive training, electronic warfare, and cybersecurity solutions primarily to U.S. Department of Defense and Intelligence Community customers.

Epicor tweaks deal

Switching to the primary market, Epicor Software set the original issue discount on its $1.925 billion first-lien term loan (B-) at 98, the tight end of the 97.5 to 98 talk, and left pricing at Libor plus 425 bps with a 1% Libor floor, a market source remarked. This tranche still has 101 soft call protection for one year.

Regarding the second-lien term loan (CCC), pricing firmed at Libor plus 775 bps, the low end of the Libor plus 775 bps to 800 bps talk, and the discount was adjusted to 98.5 from 98, the source continued. As before, this loan has a 1% Libor floor and is non-callable for one year, then at 102 in year two and 101 in year three. The call protection resets upon a change of control.

The company is also getting a pari passu second-lien floating rate note that has the same terms as the second-lien term loan, and the total amount of second-lien term loan and note debt is $825 million.

Allocations are targeted for Thursday, the source added.

KKR Capital Markets, Barclays, Nomura, Jefferies LLC, Macquarie Capital (USA) Inc. and Stone Point are leading the $2.35 billion of term loans that will be used for a dividend recapitalization.

Epicor is an Austin, Texas-based provider of enterprise business software services.

First Brands revised

First Brands raised its fungible incremental first-lien term loan due Feb. 2, 2024 to $810 million from $710 million and made two lender-friendly changes to its amendment proposal, according to a market source.

The incremental term loan is still talked at Libor plus 750 bps with a 1% Libor floor, an original issue discount of 94 and hard call protection of 102 in year one and 101 in year two.

Jefferies LLC is leading the deal that will be used to fund acquisitions and, due to the upsizing, to reduce an ABL draw.

Pro forma for the transaction, the first-lien term loan size will total about $1.579 billion.

As for the amendment, the company is seeking to increase its ABL size, revise some documentation and assign Jefferies the role of administrative agent.

Commitments and consents continued to be due at 3 p.m. ET on Wednesday.

First Brands, formerly known as Trico Group, is an automotive aftermarket platform.

Ryan moves deadline

Ryan Specialty Group accelerated the commitment deadline for its $1.65 billion seven-year term loan B (B1/B) to 5 p.m. ET on Wednesday from 5 p.m. ET on Thursday, according to a market source.

Talk on the term loan is Libor plus 375 bps with a 0.75% Libor floor and an original issue discount of 97 to 98.

J.P. Morgan Securities LLC, BMO Capital Markets and Barclays are leading the deal that will be used to help fund the company’s merger with All Risks, Ltd.

Chicago-based Ryan Specialty and Delray Beach, Fla.-based All Risks are insurance companies.

Graham discloses guidance

Graham Packaging held its lender call on Wednesday and announced price talk on its $1.41 billion seven-year covenant-lite first-lien term loan at Libor plus 400 bps with a 0.75% Libor floor and an original issue discount of 98 to 98.5, a market source said.

The term loan has 101 soft call protection for six months.

The company’s $1.51 billion of credit facilities (B) also include a $100 million revolver.

Commitments are due at 5 p.m. ET on July 29.

Credit Suisse Securities (USA) LLC and HSBC Securities (USA) Inc. are leading the deal that will be used with unsecured notes to repay existing debt at parent company Reynolds Group Holdings Ltd., including a roughly €236 million term loan, a portion of a roughly $700 million term loan, about $750 million of senior secured floating rate notes due 2021 and a $380 million securitization facility.

Graham Packaging is a designer, manufacturer and seller of food, beverage, household and automotive containers.

ProMach reveals talk

ProMach held its lender call at 4 p.m. ET on Wednesday and, shortly before the call kicked off, talk of Libor plus 350 bps with a 1% Libor floor and an original issue discount of 92 to 93 emerged on its $162.5 million covenant-lite first-lien term loan B due March 7, 2025 and $162.5 million covenant-lite delayed-draw term loan due March 7, 2025, according to a market source.

The term loan debt has 101 soft call protection for one year, and the delayed-draw term loan has a ticking fee of half the margin until Aug. 20 and the full margin thereafter.

Commitments are due at noon ET on Friday, the source added.

Morgan Stanley Senior Funding Inc. and Goldman Sachs Bank USA are leading the $325 million of senior secured term loans (B3/B-) that will be used to fund acquisitions currently under letters of intent and for general corporate purposes.

ProMach, based near Cincinnati, is a provider of packaging solutions to the food, beverage, pharmaceutical, personal care and household and industrial goods industries.

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