Penn Products, Nortek surface with deal modifications; Concordia Healthcare sets price talk

By Sara Rosenberg

New York, March 30 – Penn Products Terminals LLC increased the size of its revolver and term loan B on Monday while also trimming pricing on the tranches, updating talk on the B loan’s original issue discount and accelerating the commitment deadline.

Also on the new deal front, Nortek Inc. upsized its add-on term loan, tightened the offer price and moved up the commitment deadline, and Concordia Healthcare Corp. disclosed price talk on its term debt with launch.

In addition, Air Medical Group Holdings Inc. revealed timing and structure on its buyout financing, and Mitel Networks Corp. and Polymer Group Inc. emerged with plans to launch their loans this week.

Penn Products revised

Penn Products Terminals lifted its five-year revolver to $150 million from $125 million, its seven-year term loan B to $600 million from $575 million, and lowered pricing on both tranches to Libor plus 375 basis points from talk of Libor plus 425 bps to 450 bps on Monday, according to a market source.

Also, original issue discount guidance on the term B was adjusted to 99 to 99˝ from just 99, the source said, while the 1% Libor floor and 101 soft call protection for one year were unchanged.

Commitments are due at 2 p.m. ET on Tuesday, moved up from Wednesday.

Morgan Stanley Senior Funding Inc. is leading the now $750 million credit facility that will be used to help fund the buyout of the company by ArcLight Capital Partners.

Cash equity for the transaction was reduced due to the term loan B upsizing, the source added.

Penn Products, previously known as Petroleum Products Corp., is a refined product terminal storage business in Pennsylvania.

Nortek changes emerge

Nortek raised its fungible add-on term loan B (Ba3/BB-) to $265 million from $250 million, moved the original issue discount to 98.8 from 98.25 and accelerated the commitment deadline to noon ET on Tuesday from Wednesday, market sources said.

Pricing on the add-on term loan matches existing term loan pricing at Libor plus 275 bps with a 0.75% Libor floor. The spread stepped down last week from Libor plus 300 bps as a result of an existing pricing grid that called for the change when Moody’s Investors Service upgraded Nortek’s corporate family rating to B2 from B3.

As before, the add-on and the existing term loan are getting 101 soft call protection for six months.

Wells Fargo Securities LLC, RBC Capital Markets LLC, UBS AG and Jefferies Finance LLC are leading the deal that will be used to refinance 10% notes, and due to the upsizing, to fund the call premium on the notes.

Nortek is a Providence, R.I.-based manufacturer of air management and technology-driven products and services for residential and commercial applications.

Concordia reveals talk

Also in the primary, Concordia Healthcare held its bank meeting on Monday, launching its $650 million term loan B with talk of Libor plus 400 bps to 425 bps with a 1% Libor floor and an original issue discount of 99, according to a market source.

The company’s $750 million credit facility also includes a $100 million revolver.

RBC Capital Markets LLC, Morgan Stanley Senior Funding Inc., GE Capital Markets and TD Securities (USA) LLC are leading the deal that will be used with bonds and equity to fund the acquisition of Covis Pharma Holdings Sarl for $1.2 billion in cash and to refinance existing debt.

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

Concordia is an Oakville, Ont.-based healthcare company focused on legacy pharmaceutical products, orphan drugs and medical devices for the diabetic population. Covis is a Zug, Switzerland-based specialty pharmaceutical company providing therapeutic services to patients.

Air Medical on deck

Air Medical set a bank meeting for 1:30 p.m. ET in New York on Wednesday to launch the debt financing for its buyout by KKR from Bain Capital and Brockway Moran & Partners, according to a market source.

Also, it emerged that the financing will include a $1,095,000,000 senior credit facility – split between a $920 million term loan B and a $175 million ABL facility – and a $460 million unsecured bridge loan, the source said.

Morgan Stanley Senior Funding Inc., Jefferies Finance LLC, KKR Capital Markets LLC, Nomura Securities International Inc. and MCS Capital Markets LLC are leading the term loan B, and Bank of America Merrill Lynch, Morgan Stanley, Jefferies, KKR, Nomura and MCS are leading the ABL facility.

Closing on the buyout is expected in the second quarter, subject to customary regulatory approvals.

Air Medical is a Lewisville, Texas-based provider of air ambulance services.

Mitel coming soon

Mitel Networks scheduled a bank meeting for Tuesday to launch its previously announced $700 million senior secured credit facility (Ba3/B+) that is comprised of a $50 million five-year revolver and a $650 million seven-year first-lien term loan B, a market source said.

The term loan has 101 soft call protection for six months, the source said.

Previously, the company said in an 8-K filed with the Securities and Exchange Commission that pricing on the revolver and the term loan is expected at Libor plus 450 bps, with the revolver having no Libor floor and the term loan having a 1% Libor floor, however, official price talk on the deal is not yet available.

Bank of America Merrill Lynch and Credit Suisse Securities (USA) LLC are leading the credit facility.

Mitel buying Mavenir

Proceeds from Mitel’s credit facility, along with cash on hand, will be used to fund the acquisition of Mavenir Systems Inc. in a cash and stock deal valued at about $560 million and to refinance existing credit facilities at both companies.

Under the agreement, Mavenir stockholders will be entitled to elect to receive either all-cash or all-stock consideration for each share of Mavenir common stock, subject to proration, in either case with a value of $11.08 plus 0.675 of a Mitel common share, or $17.94 based on the closing price of a Mitel common share on Feb. 27.

Closing is expected in the second quarter, subject to the tender of a majority of Mavenir’s common stock shares, regulatory and stock exchange approvals and other customary conditions.

Net leverage ratio will be about 3.2 times trailing adjusted EBITDA.

Mitel is a Kanata, Ont.-based provider of cloud- and premises-based unified communications software services. Mavenir is a Richardson, Texas-based provider of software-based networking services for mobile carriers.

Polymer readies call

Polymer Group will hold a lender call on Wednesday to launch its $70 million add-on term loan that was announced last week, according to a market source.

Jefferies Finance LLC is leading the deal.

Proceeds will be used to fund the acquisition of Dounor SAS, which is expected to close in the second quarter, subject to customary terms and conditions.

Polymer Group is a Charlotte, N.C.-based developer, producer and marketer of specialty materials used in infection prevention, personal care and high-performance products. Dounor is a Neuville en Ferrain, France-based manufacturer of materials used in hygiene, health care and industrial applications.

BWICs announced

In other news, two Bids Wanted In Competition emerged – one is a $70.9 million loan BWIC due at noon ET on Tuesday, and the other is a roughly $88 million cash loan and equity BWIC due at 11 a.m. ET on Wednesday, according to traders.

Some of the issuers in the $70.9 million BWIC are Allison Transmission Inc., CommScope Inc., First Data Corp., NBTY Inc., Revlon Consumer Products Corp., Sensus USA Inc., TPF Generation Holdings LLC and West Corp. There are about 48 issuers in the portfolio.

As for the $88 million BWIC, some of the issuers include Aramark Corp., Biomet Inc., Federal-Mogul Corp., First Data Corp., HCA Inc., Revlon Consumer Products Corp., Univar Inc. and West Corp. There are about 79 loan issuers in the portfolio, the trader added.

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