New Media breaks; PetSmart makes second cut to pricing; Nord Anglia, Armacell on deck

By Sara Rosenberg

New York, Feb. 13 – New Media Investment Group Inc.’s term loan emerged in the secondary market on Friday with the debt seen bid in line with its original issue discount.

Meanwhile, in the primary market, PetSmart Inc. trimmed pricing on its term loan B for a second time, and Nord Anglia Education Inc. and Armacell surfaced with new loan plans.

New Media starts trading

New Media Investment Group’s $327 million term loan due June 2020 freed up for trading on Friday with levels seen at 99 bid, 99¾ offered, according to a market source.

Pricing on the loan is Libor plus 625 basis points with a 1% Libor floor, and it was sold at an original issue discount of 99. There is 101 soft call protection for six months.

Citizens Financial Group is leading the deal that will be used to refinance the company’s existing three term loans due June 2020 priced at Libor plus 625 bps with a 1% Libor floor.

The existing loans are split between a $102 million term loan that funded recently, a $25 million add-on term loan completed in September 2014 and a $200 million term loan completed around the summer of 2014.

As previously reported, the existing $102 million term loan had been launched into syndication in early December with a size of $170 million and talk of Libor plus 550 bps to 575 bps with a 1% Libor floor and an original issue discount of 99, but, in order for the deal to close, it ended up being downsized and funded by the lead.

New Media is a New York-based publisher of locally based print and online media.

PetSmart trims pricing

Over in the primary, PetSmart cut the spread on its $4.3 billion seven-year senior secured covenant-light term loan B (Ba3/BB-) to Libor plus 400 bps from revised talk of Libor plus 425 bps and initial talk of Libor plus 450 bps to 475 bps, according to a market source.

As before, the term loan has a 1% Libor floor, an original issue discount of 99½, 101 soft call protection for one year and, beginning on March 20, a ticking fee of the full spread plus the Libor floor.

Earlier in syndication, the discount on the term loan was tightened from 99.

Recommitments are due at 5 p.m. ET on Tuesday. The source explained that only recommitments will be accepted, and new or incremental commitments will not be accepted.

Allocations are targeted for the second half of the week of Feb. 16, the source added.

The company’s $5.05 billion credit facility also provides for a $750 million five-year asset-based revolver.

PetSmart lead banks

Citigroup Global Markets Inc., Barclays, Deutsche Bank Securities Inc., Nomura Securities International Inc., Jefferies Finance LLC, RBC Capital Markets and Macquarie Capital (USA) Inc. are leading PetSmart’s credit facility.

Proceeds will be used with $1.9 billion of senior notes and about $2.3 billion of equity to fund the buyout of the company by a consortium led by BC Partners Inc. for $83.00 per share in cash, or about $8.7 billion.

The buying consortium includes funds advised by BC Partners, alongside several of its limited partners, such as La Caisse de depot et placement du Quebec and StepStone.

Closing is expected during the week of March 9, subject to shareholder and regulatory approval and other customary conditions. The shareholder vote will take place on March 6.

PetSmart is a Phoenix-based specialty pet retailer.

Nord Anglia coming soon

Nord Anglia Education set a conference call for 10 a.m. ET on Tuesday to launch a fungible $125 million add-on term loan, a market source said.

Goldman Sachs Bank USA and HSBC Securities (USA) Inc. are leading the deal that will be used to fund the acquisition of four schools in Vietnam.

The company’s existing term loan is priced at Libor plus 350 bps with a 1% Libor floor.

Nord Anglia Education is a Hong Kong-based operator of schools.

Armacell readies loan

Armacell scheduled a call for 10 a.m. ET on Tuesday to launch a €65 million-equivalent tack-on first-lien covenant-light term loan due July 2, 2020 that will include U.S. dollar and euro tranches, according to a market source.

The U.S. tack-on debt is priced at Libor plus 450 bps with a 1% Libor floor and the euro piece is priced at Euribor plus 475 bps with a 1% floor, in line with existing U.S. and euro term loan pricing, the source said.

Original issue discount talk on the tack-on debt is still to be determined.

Credit Suisse Securities (USA) LLC, BNP Paribas Securities Corp., HSBC Securities (USA) Inc. and ING are leading the deal that will be used to fund two bolt-on acquisitions.

Armacell is a Luxembourg-based manufacturer of elastomeric foams.

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