Encompass Digital breaks; Long Term Care finalizes spread; Peak 10 accelerates deadline

By Sara Rosenberg

New York, June 3 - Encompass Digital Media Inc.'s credit facility emerged in the secondary market on Tuesday afternoon, with both the first-and second-lien term loans quoted above their original issue discount prices.

Switching to the primary market, Long Term Care Group Inc. firmed pricing on its term loan B at the low end of guidance, and Peak 10 Inc. moved up the commitment deadline on its credit facility.

Also, DaVita Healthcare Partners Inc., Michaels Stores Inc., Wayne Fueling Systems LLC (Alfred Fueling Systems), Custom Sensors & Technologies and Consolidated Container Co. LLC announced price talk with launch.

In addition, J.C. Penney Co. Inc., Bayonne Energy Center LLC, VeriFone Inc., GST AutoLeather Inc., American Tire Distributors Inc. and World Triathlon Corp. surfaced with new deal plans.

Encompass frees up

Encompass Digital Media's credit facility broke for trading on Tuesday, with the $265 million seven-year first-lien term loan (B2/B+) quoted at par ½ bid, 101¼ offered and the $75 million eight-year second-lien term loan (Caa2/CCC+) quoted at 102 bid, 103 offered, according to a trader.

Pricing on the first-lien term loan is Libor plus 450 basis points with a 1% Libor floor and it was issued at a discount of 991/2. There is 101 soft call protection for six months.

The second-lien term loan is priced at Libor plus 775 bps, after flexing during syndication from Libor plus 750 bps. This tranche has a 1% Libor floor and call protection of 103 in year one and 101 in year two, and was issued at 99.

The company's $370 million credit facility also includes a $30 million five-year revolver (B2/B+).

BMO Capital Markets and Macquarie Capital are leading the deal that will be used to refinance existing debt and prefund payments related to a 2012 acquisition.

Encompass is a provider of mission-critical media capture, management and distribution services.

Long Term sets spread

Moving to the primary, Long Term Care Group firmed pricing on its $175 million term loan B due 2020 at Libor plus 525 bps, the tight end of the Libor plus 525 bps to 550 bps talk, and moved up the commitment deadline to 5 p.m. ET on Tuesday from Wednesday, according to a market source.

As before, the term loan B has a 1% Libor floor, an original issue discount of 99½ and 101 soft call protection for one year.

The company's $195 million senior secured credit facility also includes a $20 million revolver.

RBC Capital Markets and MCS Capital Markets are leading the deal that will be used to help fund the buyout of the company by Stone Point Capital from Univita Health.

Long Term Care Group is an Eden Prairie, Minn.-based business process outsourcing company for the long-term care insurance industry.

Peak 10 changes deadline

Peak 10 accelerated the commitment deadline on its $525 million credit facility to 5 p.m. ET on Thursday from June 12, a market source said.

The facility consists of a $65 million revolver (B2/B), a $330 million seven-year first-lien covenant-light term loan (B2/B) and a $130 million eight-year second-lien covenant-light term loan (Caa2/CCC+).

Talk on the first-lien term loan is Libor plus 450 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, and the second-lien term loan is talked at Libor plus 750 bps with a 1% Libor floor, a discount of 99 and call protection of 102 in year one and 101 in year two.

Credit Suisse Securities (USA) LLC, RBC Capital Markets and Jefferies Finance LLC are the lead banks on the deal, with Credit Suisse left lead on the first-lien and RBC left lead on the second-lien.

Proceeds will be used to help fund the buyout of the Charlotte, N.C.-based IT infrastructure and cloud provider by GI Partners from Welsh, Carson, Anderson & Stowe.

Closing is expected this quarter, subject to regulatory approvals and customary conditions.

DaVita Healthcare launches

Also on the new deal front, DaVita Healthcare Partners held its bank meeting on Tuesday, and with the event, price talk on its $5.5 billion credit facility (Ba1) was announced, according to a market source.

The $1 billion five-year revolver and $1 billion five-year term loan A are both talked at Libor plus 175 bps, subject to a grid, and are offered with upfront fees of 30 bps for commitments of $75 million and up, 20 bps for commitments of $50 million and up, 12.5 bps for commitments of $25 million and up and 10 bps for commitments less than $25 million, the source said.

Meanwhile, the $3.5 billion seven-year term loan B is talked at Libor plus 300 bps to 325 bps with a 0.75% Libor floor, an original issue discount of 99½ and 101 soft call protection for six months, the source continued.

The Denver-based provider of kidney and dialysis services is asking for commitments by June 17.

Barclays, Wells Fargo Securities LLC, Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC, Goldman Sachs Bank USA, J.P. Morgan Securities LLC, Morgan Stanley Senior Funding Inc. and SunTrust Robinson Humphrey Inc. are leading the deal that will be used with up to $1.75 billion of unsecured debt to refinance existing debt and for general corporate purposes.

Michaels Stores reveals talk

Michaels Stores came out with talk of Libor plus 300 bps with a 1% Libor floor, an original issue discount of 99 to 99½ and 101 soft call protection for six months on its $850 million covenant-light term loan due January 2020 that launched with a call in the morning, a market source remarked.

Commitments are due at noon ET on June 10, the source added.

Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Barclays, Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC, Morgan Stanley Senior Funding Inc., Wells Fargo Securities LLC, Guggenheim and Macquarie Capital (USA) Inc. are leading the deal that will be used to refinance existing senior notes due 2018.

Michaels Stores is an Irving, Texas-based arts and crafts specialty retailer.

Wayne details surface

Wayne Fueling held its bank meeting, and with the launch, structure and price talk was revealed on its $460 million senior secured credit facility, according to a market source.

The facility consists of a $75 million five-year revolver (B1), a $285 million seven-year covenant-light first-lien term loan (B1) talked at Libor plus 400 bps with a 1% Libor floor, an original issue discount of 99½ and 101 soft call protection for six months, and a $100 million eight-year covenant-light second-lien term loan (Caa1) talked at Libor plus 725 bps to 750 bps with a 1% Libor floor, a discount of 99, and call protection of 102 in year one and 101 in year two, the source said.

Citigroup Global Markets Inc., UBS AG, Credit Suisse Securities (USA) LLC and BNP Paribas Securities Corp. are leading the deal that will help fund the company's buyout by Riverstone Holdings LLC from GE.

Commitments are due at 5 p.m. ET on June 13 and closing is targeted for June 20, the source added.

Wayne is an Austin, Texas-based designer, manufacturer and servicer of fuel dispensers and forecourt technologies.

Custom Sensors pricing

Custom Sensors & Technologies disclosed talk of Libor plus 375 bps to 400 bps with a 1% Libor floor, an original issue discount in the 99 area and 101 soft call protection for six months on its $470 million seven-year covenant-light first-lien term loan that launched with a bank meeting, a source remarked.

In addition, talk on the company's $120 million eight-year covenant-light second-lien term loan came out at Libor plus 725 bps to 750 bps with a 1% Libor floor, a discount in the 99 area, and hard call protection of 102 in year one and 101 in year two, the source continued.

The $665 million credit facility also includes a $75 million five-year revolver.

Commitments are due at noon ET on June 17, the source added.

Custom Sensors lead banks

Deutsche Bank Securities Inc., Bank of America Merrill Lynch and Mizuho are leading Custom Sensors' credit facility, with Deutsche Bank left lead on the first-lien loan and Bank of America left lead on the second-lien loan.

Proceeds from the credit facility and equity will be used to fund the acquisition of a majority stake in the company by The Carlyle Group and PAI Partners from Schneider Electric.

Custom Sensors is a designer and manufacturer of specialized high-end ultra-sensitive sensors, controls and actuation products used in mission critical applications.

Consolidated Container guidance

Consolidated Container launched with a call its $80 million senior secured covenant-light second-lien term loan due Jan. 3, 2020, and talk on the debt emerged at Libor plus 600 bps with a 1.25% Libor floor, an original issue discount of 98 and call protection of 103 in year one, 102 in year two and 101 in year three, a source said.

Commitments are due on June 12 and closing is expected in the week of June 16, the source added.

Citigroup Global Markets Inc. is leading the deal that will be used for acquisition financing.

Consolidated Container is an Atlanta-based developer and manufacturer of rigid plastic packaging.

J.C. Penney readies deal

J.C. Penney set a bank meeting for Thursday to launch a $2.35 billion credit facility that includes a $500 million term loan (B2) and a $1.85 billion asset-based revolver (B1), according to a market source.

Bank of America Merrill Lynch, Wells Fargo Securities LLC, J.P. Morgan Securities LLC, Barclays and Goldman Sachs Bank USA are leading the deal, with Bank of America on the left of the term loan and Wells Fargo on the left of the revolver.

Proceeds will be used by the Plano, Texas-based operator of department stores to refinance an existing asset-based revolver and for general corporate purposes.

Bayonne coming soon

Bayonne Energy Center scheduled a bank meeting for 10 a.m. ET in New York on Wednesday to launch a $530 million senior secured credit facility, according to a market source.

The facility consists of a $30 million revolver and a $500 million term loan B, the source said.

Morgan Stanley Senior Funding Inc., Macquarie Capital (USA) Inc. and Credit Agricole CIB are leading the deal that will be used to fund Arclight Capital Partners LLC's acquisition from Hess Corp. of the remaining 50% interest in Bayonne Energy that it does not currently own.

Bayonne Energy is a Bayonne, N.J., natural gas-fueled power plant.

VeriFone joins calendar

VeriFone set a bank meeting for Wednesday to launch a $1.2 billion credit facility, according to a market source.

The facility consists of a $400 million revolver, a $550 million term loan A and a $250 million term loan B, the source said.

J.P. Morgan Securities LLC is leading the deal that will be used to refinance existing debt.

VeriFone is a San Jose, Calif.-based company that makes secure electronic payment equipment.

GST plans meeting

GST AutoLeather scheduled a bank meeting for 2 p.m. ET on Monday to launch a $180 million senior secured credit facility, according to a market source.

The facility consists of a $30 million five-year revolver and a $150 million six-year term loan B, the source said.

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

GST is a Southfield, Mich.-based automotive leather manufacturer.

American Tire incremental loan

American Tire Distributors intends to hold a call on Wednesday to launch a $420 million incremental term loan due June 2018 that is split between a $340 million funded tranche and an $80 million delayed-draw tranche, a source said.

The loan is talked at Libor plus 475 bps with a 1% Libor floor and an original issue discount that is still to be determined, the source added.

Bank of America Merrill Lynch is leading the deal that will be used to refinance 9¾% notes.

American Tire is a Huntersville, N.C.-based replacement tire distributor.

World Triathlon on deck

World Triathlon plans to launch a new loan deal during the week of June 9 that will be used for a recapitalization, according to a market source.

UBS AG is leading the deal.

World Triathlon is a Tampa Bay, Fla.-based owner and operator of Ironman triathlon events.

Hearthside closes

In other news, the buyout of Hearthside Group Holdings LLC by Goldman Sachs and Vestar Capital Partners from Wind Point Partners has been completed, according to a news release.

For the transaction, Hearthside got a new $665 million credit facility (B1/B) that includes a $100 million five-year revolver and a $565 million seven-year covenant-light first-lien term loan.

Pricing on the term loan is Libor plus 350 bps with a 1% Libor floor and it was sold at an original issue discount of 991/2. The debt has 101 soft call protection for one year.

During syndication, the term loan was downsized from $575 million, pricing firmed at the high end of the Libor plus 325 bps to 350 bps talk, and the call protection was extended from six months.

Senior secured leverage is 4.4 times and total leverage is 6.8 times.

Barclays, Goldman Sachs Bank USA, Deutsche Bank Securities Inc., Fifth Third Securities Inc. and KeyBanc Capital Markets led the deal for the Downers Grove, Ill.-based bakery and contract food manufacturer.

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