Paradigm upsizes, frees up; Pilot Travel Centers dips with debt news; American Capital sets talk

By Sara Rosenberg

New York, July 24 - Paradigm Holdco Sarl's credit facility made its way into the secondary market on Tuesday afternoon after an upsizing, with the first- and second-lien term loans seen above their original issue discount prices.

Also in trading, Pilot Travel Centers LLC's term loan B was softer on the back of news that the company will be approaching lenders with incremental bank debt this week.

In more happenings, American Capital Ltd. released talk and Patriot Coal Corp. came out with original issue discount guidance with launch, and WaveDivision Holdings LLC started going out with some early all-in yield guidance on its term loan B in preparation for its upcoming bank meeting.

Paradigm hits secondary

Paradigm's credit facility freed up for trading on Tuesday, with both the $305 million seven-year covenant-light first-lien term loan (B1/B+) and the $135 million eight-year covenant-light second-lien term loan (Caa1/CCC+) quoted at 98½ bid, 99½ offered on the break, a trader said, adding that by late day, the second-lien tranche had moved up to 99½ bid, par ½ offered.

Pricing on the first-lien term loan, which was upsized from $290 million, is Libor plus 525 basis points with a 1.25% Libor floor, and it was sold at an original issue discount of 98. The tranche includes 101 soft call protection for one year.

The second-lien term loan, which was upsized from $130 million, is priced at Libor plus 925 bps with a 1.25% floor and was sold at a discount of 98. This debt has call protection of 103 in year one, 102 in year two and 101 in year three.

Paradigm lead banks

UBS Securities LLC and RBC Capital Markets LLC are the lead banks on Paradigm's $480 million credit facility, which also provides for a $40 million five-year revolver (B1/B+).

Proceeds will be used to help fund the roughly $1 billion buyout of the company by Apax Partners and JMI Equity from Fox Paine & Co.

Equity for the transaction is 51%, down from 53% originally since the equity contribution was reduced by $20 million due to the upsizing to the first-and second-lien term loans, a source remarked.

Paradigm is a software vendor focused on the oil and gas exploration and production space with a significant presence across Europe, the Americas, the Middle East, Africa, China and Australasia.

Pilot Travel softens

Pilot Travel Centers' term loan B dipped to 99½ bid, par offered, from par bid, par ½ offered as investors reacted to Monday's late-day news of an upcoming bank deal, according to a trader.

As was previously reported, the company will be holding a conference call on Wednesday to launch $1.1 billion of new bank debt (Ba2) that is comprised of a $100 million add-on revolver, a $300 million add-on term loan A and a $700 million term loan B-2.

Bank of America Merrill Lynch, Wells Fargo Securities LLC and SunTrust Robinson Humphrey Inc. are the lead banks on the deal.

Pilot, a Knoxville, Tenn.-based operator of travel centers, will use proceeds from the loans to fund a distribution to shareholders and for acquisitions and general corporate purposes.

American Capital pricing

Over in the primary, American Capital held a bank meeting on Tuesday afternoon to kick off syndication on its $600 million four-year term loan B, and with the launch, price talk was announced, according to a market source.

The B loan is talked at Libor plus 475 bps to 500 bps with a 1.25% Libor floor and an original issue discount of 99, and includes 101 soft call protection for one year, the source said.

Amortization is 25% per annum.

Commitments are due on Aug. 3, and the company is looking to allocate and close on Aug. 10.

Expected ratings are B2/B, the source added.

American Capital revolver talk

American Capital's $750 million credit facility also includes a $150 million four-year revolver that is being talked at Libor plus 375 bps with a 50 bps unused fee, the company disclosed in an 8-K filed with the Securities and Exchange Commission on Tuesday.

The revolver has no amortization in first three years, then amortizes at a rate of 8.33% per month in year four.

J.P. Morgan Securities LLC, BMO Capital Markets Corp. and UBS Securities LLC are the joint lead arrangers on the deal that will be used to refinance basically all of the company's existing recourse debt and for working capital and general corporate purposes.

American Capital is a Bethesda, Md.-based private equity firm and global asset manager.

Patriot discounts

Patriot Coal also held a bank meeting on Tuesday, and its $375 million super-priority senior secured first-out term loan was launched with an original issue discount of 98, according to sources.

As previously outlined, the loan is talked at Libor plus 800 bps and a 1.5% Libor floor.

The company's $802 million 15-month debtor-in-possession credit facility also includes a $125 million super-priority senior secured revolver talked at Libor plus 325 bps with a 75 bps upfront fee and a $302 million second-out roll-up of letters-of-credit loan talked at Libor plus 800 bps with a 1.5% floor when fully drawn and with a 450 bps fee on unfunded letters-of-credit, sources said.

Citigroup Global Markets Inc., Barclays Capital Inc. and Bank of America Merrill Lynch are leading the deal that will fund operations, working capital needs and general corporate purposes during the company's Chapter 11 reorganization.

Patriot Coal, a St. Louis-based miner, producer and seller of thermal coal primarily to electricity generators, is asking for commitments for the DIP by July 31, sources added.

WaveDivision floats guidance

WaveDivision's $470 million term loan B is being talked to yield in the low-6% area, including coupon, Libor floor and original issue discount, ahead of its Thursday bank meeting, a market source told Prospect News.

A specific breakdown on the pricing components is not yet available, the source said.

The term loan B is part of a $520 million credit facility (Ba3) that also provides for a $50 million revolver.

Although the bank meeting has not yet happened, the deal has already seen "lots of early interest", the source added.

WaveDivision being acquired

Proceeds from WaveDivision's credit facility will be used to help fund its buyout by Oak Hill Capital Partners, GI Partners and management from Sandler Capital Management.

Wells Fargo Securities LLC, Deutsche Bank Securities Inc. and RBC Capital Markets LLC are the lead banks on the bank deal.

Closing is expected in the fourth quarter, subject to regulatory approvals and customary conditions.

WaveDivision is a Kirkland, Wash.-based owner and operator of broadband cable systems.

Drew Marine well met

In other news, Drew Marine's $135 million credit facility was "oversubscribed by a healthy margin" by Tuesday's commitment deadline, according to a market source.

The facility consists of a $20 million five-year revolver, and a $115 million six-year term loan that is talked at Libor plus 525 bps with a 1.5% Libor floor. An original issue discount of 99 is being offered on new term loan money and 99½ on old money. How much of the deal will be new money depends on the amount of rollover from existing lenders.

BNP Paribas Securities Corp. is leading the deal that will refinance existing debt and fund the acquisition of Chemring Group plc's maritime interests for £32 million.

Closing is expected by the end of this month, subject to regulatory approvals.

Drew Marine is a Whippany, N.J.-based provider of technical solutions and services to the marine industry. The Chemring maritime business is a Hampshire, U.K.-based supplier of marine distress signals.

LifePoint closes

LifePoint Hospitals closed on its $800 million five-year credit facility that consists of a $350 million revolver and a $450 million term loan A, according to a news release.

Both the revolver and A loan are priced at Libor plus 175 bps.

Citigroup Global Markets Inc., Barclays Capital Inc. and Bank of America Merrill Lynch led the deal that was used to refinance existing debt.

LifePoint Hospitals is a Brentwood, Tenn.-based hospital company.

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