Power Solutions, XPO Logistics, Ocwen Financial changes emerge; Aptean, Newport set talk

By Sara Rosenberg

New York, March 13 – Power Solutions (Panther BF Aggregator 2 LP) on Wednesday lowered price talk on its U.S. term loan B, set the spread on its euro term loan B at the low side of guidance, tightened the original issue discounts on both tranches and extended the call protection.

Also on the new deal front, XPO Logistics Inc. revised the issue price on its incremental term loan B-1, and Ocwen Financial Corp. increased the size of its incremental term loan.

In addition, Aptean and Newport Group released price talk on their term loans with launch, and Datto Inc. surfaced with new deal plans.

Power Solutions revised

Power Solutions trimmed price talk on its $3.2 billion seven-year term loan B to a range of Libor plus 350 basis points to 375 bps from a range of Libor plus 400 bps to 425 bps, and modified the original issue discount to 99 from 98.5, according to a market source.

Furthermore, pricing on the company’s $2.25 billion equivalent euro seven-year term loan B was set at Euribor plus 400 bps, the low end of the Euribor plus 400 bps to 425 bps talk, and the discount was adjusted to 99.5 from 99, the source said.

Also, the 101 soft call protection on both term loans was extended to one year from six months.

The term loans still have a 0% floor.

Commitments are due at 10 a.m. ET on Thursday, moved up from noon ET on Thursday, the source added.

Power Solutions leads

J.P. Morgan Securities LLC is the left lead on Power Solutions’ U.S. term loan B, and Barclays is the left lead on the euro term loan B. Filings with the Securities and Exchange Commission listed Credit Suisse, Bank of America Merrill Lynch, BMO Capital Markets, CIBC Capital Markets, Citigroup, Deutsche Bank, Goldman Sachs, HSBC, RBC Capital Markets, Bank of Nova Scotia and TD Securities as leads as well.

The $5.45 billion equivalent of term loans (Ba3/B+/BB), $4.7 billion equivalent of bonds and equity will be used to fund the acquisition of Johnson Controls’ power solutions business by Brookfield Business Partners LP and Caisse de depot et placement du Quebec for around $13.2 billion.

Closing is expected by June 30, subject to customary conditions, including regulatory approvals.

Power Solutions is a supplier of low voltage automotive batteries.

XPO tweaks loan

XPO Logistics changed the original issue discount on its non-fungible $500 million covenant-lite incremental term loan B-1 due February 2025 to 99.5 from 99, a market source remarked.

As before the term loan B-1 is priced at Libor plus 250 bps with a 0% Libor floor, and has 101 soft call protection for six months.

Commitments were due at 5 p.m. ET on Wednesday and allocations are targeted for Thursday, the source added.

Morgan Stanley Senior Funding Inc. is leading the deal that will be used for general corporate purposes, including to fund purchases of the company’s common stock as part of a previously announced share repurchase plan, and to pay related fees and expenses.

XPO Logistics is a Greenwich, Conn.-based provider of supply chain solutions.

Ocwen upsizes

Ocwen raised its incremental senior secured term loan due December 2020 to $120 million from $100 million, and left priced at Libor plus 500 bps with a 1% Libor floor and an original issue discount of 99.25, according to a market source.

Barclays and J.P. Morgan Securities are leading the deal that will be used for general corporate purposes, including repayment of the PHH Notes and a small portfolio or platform acquisition.

The borrower is Ocwen Loan Servicing LLC.

Ocwen is a West Palm Beach, Fla.-based non-bank mortgage servicer and originator.

Aptean reveals guidance

Aptean held its bank meeting on Wednesday morning and announced talk on its $350 million covenant-lite first-lien term loan (B2/B-) at Libor plus 425 bps to 450 bps with a 0% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, a market source said.

Commitments are due on March 27, the source added.

The company’s $650 million of credit facilities also include a $50 million revolver, a $100 million privately placed covenant-lite delayed-draw first-lien term loan and a $150 million privately placed covenant-lite second-lien term loan.

Golub Capital and Macquarie Capital (USA) Inc. are leading the deal that will be used to back a joint investment from TA Associates and Vista Equity Partners. TA Associates and Vista will be equal partners, each investing new equity to acquire Aptean from the separate Vista fund that initially invested in the company in 2012.

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

Aptean is an Alpharetta, Ga.-based provider of mission-critical, industry-specific enterprise software solutions.

Newport floats talk

Newport Group came out with original issue discount talk of 99 on its fungible $63.5 million add-on first-lien term loan that launched with an afternoon lender call, according to a market source.

Like the existing term loan, pricing on the incremental term loan is Libor plus 375 bps with a 0% Libor floor.

Commitments are due at noon ET on March 20.

RBC Capital Markets is leading the debt that will be used for an acquisition.

Newport Group, a Kelso & Co. portfolio company, is a Walnut Creek, Calif.-based provider of retirement services and consulting services related to retirement plans.

Datto joins calendar

Datto set a bank meeting for 10 a.m. ET in New York on Thursday to launch a $550 million seven-year covenant-lite first-lien term loan that is talked with a 0% Libor floor and 101 soft call protection for six months, a market source remarked.

Commitments are due on March 28, the source added.

Credit Suisse Securities (USA) LLC is the left lead on the loans, which will be used to refinance existing debt.

Datto is a Norwalk, Conn.-based provider of data protection and IT solutions to small and medium-sized businesses.

Parts Town allocates

In other news, Parts Town (PT Holdings LLC) allocated its fungible $30 million incremental first-lien term loan (B3/B-) due Dec. 7, 2024, according to a market source.

Pricing on the incremental loan is Libor plus 400 bps with a 1% Libor floor, in line with existing term loan pricing, and the new debt was sold at an original issue discount of 98.85.

Jefferies LLC is leading the deal that will be used to fund an acquisition.

Closing is expected on Thursday.

Parts Town is an Addison, Ill.-based OEM parts distributor and service provider to the foodservice equipment market.

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