Walter Energy up with amendment; Guggenheim closing early; Oxbow, U.S. Silica update deals

By Sara Rosenberg

New York, July 16 - Walter Energy Inc.'s term loan B headed higher in trading on Tuesday as the company launched an amendment that would bump up pricing, add call protection and pay out a consent fee in return for covenant changes.

Going to the primary, Guggenheim Partners Investment Management Holdings LLC moved up the commitment deadline on its term loan B, Oxbow Carbon LLC shifted funds between its pro rata and term loan B tranches, and U.S. Silica Holdings Inc. finalized pricing on its term loan at the low end of guidance.

Also, Pinnacle Entertainment Inc. and CeramTec GmbH released talk with launch, and Harbor Freight Tools USA Inc., Alinta Energy Finance Pty Ltd. and Midcontinent Communications emerged with new deal plans.

Walter Energy rises

Walter Energy's term loan B moved higher in the secondary market on Tuesday after news surfaced that an amendment to pricing and covenants is being sought, according to a trader.

The B loan was quoted at 99¼ bid, par ¼ offered, up from 97¾ bid, 98½ offered, the trader said.

Under the amendment that launched with a call in the afternoon, the company would raise the spread on its term loans by 100 basis points on the existing grid, bringing the term B to Libor plus 575 bps and the term A to Libor plus 550 bps, a market source said.

Also, the term loan B would get hard call protection of 102 for six months and 101 for months seven through 18, term B lenders would get a 100 bps consent fee and term A lenders would get a 75 bps consent fee.

Walter revising covenants

With the sweetening of terms, Walter Energy is asking lenders to remove the senior secured leverage ratio through the first quarter of 2014 and the interest coverage ratio through all of 2014 and then provide for looser covenants once they are reinstated, the source remarked.

Furthermore, the amendment would add a minimum liquidity covenant of $225 million while senior secured leverage is greater than 5.5 times, include a maximum capital expenditures covenant of $175 million for 2013 and $200 million for 2014, and reduce the company's dividend to $0.01 per share while senior secured leverage is greater than 4.5 times.

Additionally, the company would have the ability to raise $250 million of additional unsecured or second-lien debt for liquidity purposes.

Consents are due on July 23, the source continued.

Morgan Stanley Senior Funding Inc. is leading the amendment for the Birmingham, Ala.-based pure-play metallurgical coal producer.

Guggenheim revises deadline

Over in the primary, Guggenheim Partners Investment Management accelerated the commitment deadline on its $700 million seven-year covenant-light term loan B to noon ET on Wednesday from end of day Thursday, according to a market source.

The term loan is talked at Libor plus 350 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year.

Bank of America Merrill Lynch, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, RBC Capital Markets and Fifth Third Securities Inc. are the lead banks on the deal.

Proceeds will be used to refinance existing debt, to fund a distribution to parent company Guggenheim Partners LLC and for general corporate purposes.

Guggenheim Partners is a financial services firm with headquarters in New York and Chicago.

Oxbow Carbon restructures

Oxbow Carbon trimmed its six-year covenant-light term loan B (Ba3/BB+) to $350 million from $500 million and left talk at Libor plus 350 bps to 375 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, according to sources.

On the flip side, the company upsized its five-year revolver (Ba3/BB+) to $800 million from $600 million and its five-year term loan A (Ba3/BB+) to $300 million from $250 million, sources said. These tranches are talked at Libor plus 250 bps, sources said.

The company's now $1.8 billion credit facility still includes a $350 million 61/2-year second-lien term loan (B2/BB-) that is talked at Libor plus 725 bps to 750 bps with a 1% Libor floor, a discount of 99 and call protection of 103 in year one, 102 in year two and 101 in year three.

Commitments are due at noon ET on Wednesday, revised from Thursday, sources added.

Bank of America Merrill Lynch and J.P. Morgan Securities LLC are leading the deal that will be used to refinance existing debt.

Oxbow Carbon is a West Palm Beach, Fla.-based recycler of refinery and natural gas byproducts.

U.S. Silica sets spread

U.S. Silica firmed pricing on its $375 million term loan due May 2020 at Libor plus 300 bps, the tight end of the Libor plus 300 bps to 325 bps talk, while keeping the 1% Libor floor, original issue discount of 99½ on new money and 101 soft call protection for six months intact, according to a market

The company's $425 million senior secured credit facility (B1/BB-) also includes a $50 million revolver due July 2018.

Allocations are expected to go out end of this week or early next week, the source remarked.

BNP Paribas Securities Corp. is leading the deal that will be used to refinance existing senior debt, including a $50 million asset-based revolver and a $255 million term loan.

Closing is expected in the third quarter.

U.S. Silica is Frederick, Md.-based producer of ground and unground silica sand, kaolin clay, aplite and related industrial minerals.

Pinnacle talk emerges

Pinnacle Entertainment held a bank meeting on Tuesday morning to launch its $1.6 billion seven-year covenant-light term loan B, and shortly before the event kicked off, talk on the loan came out at Libor plus 350 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, according to a market source.

The company's $2.6 billion senior secured credit facility (NA/BB+/BB+) also includes a $1 billion five-year revolver.

Commitments are due on July 29.

J.P. Morgan Securities LLC, Goldman Sachs Lending Partners LLC, Bank of America Merrill Lynch, Deutsche Bank Securities Inc., Wells Fargo Securities LLC, Barclays, Credit Agricole and UBS Securities LLC are leading the deal.

Pinnacle buying Ameristar

Proceeds from Pinnacle's credit facility and up to $800 million of senior notes will be used to fund the purchase of Ameristar Casinos Inc. for $26.50 per share in cash, redeem 8 5/8% senior notes due 2017 and for working capital and general corporate purposes.

Closing is expected by the end of the third quarter, subject to customary conditions, approval by Ameristar's shareholders and required regulatory approvals.

Pro forma for the transaction, senior secured leverage will be 2.9 times while total leverage will be 6.6 times, and net senior secured leverage will be 2.6 times while net total leverage will be 6.3 times.

Pinnacle Entertainment is a Las Vegas-based owner and operator of casinos. Ameristar is a Las Vegas-based casino gaming company.

CeramTec sets guidance

CeramTec held its London meeting, launching its €324 million seven-year covenant-light euro term B tranche with talk of Euribor plus 425 bps to 450 bps and its €324 million seven-year covenant-light U.S. equivalent term B tranche with talk of Libor plus 400 bps to 425 bps, a market source said.

Both the U.S. and the euro loans have a 1% floor and an original issue discount of 99, the source said.

The company's €748 million credit facility, which will launch to U.S. investors with a bank meeting in New York on Wednesday, also includes a €100 million five-year revolver.

Deutsche Bank Securities Inc., RBC Capital Markets and UBS Securities LLC are leading the deal that will help fund the buyout of the company by Cinven from Rockwood Holdings Inc. for €1.49 billion.

Closing is expected in the third quarter, subject to regulatory approvals, including the E.U. Competition Clearance Authority.

CeramTec is a Plochingen, Germany-based producer of high performance advanced ceramics materials and products.

Harbor Freight readies loan

In more new deal happenings, Harbor Freight set a call for 1:30 p.m. ET on Wednesday to launch a $1 billion six-year senior secured covenant-light term loan that includes 101 repricing protection for one year, according to a market source.

Credit Suisse Securities (USA) LLC is leading the deal for which commitments will be due on July 24, the source said.

Proceeds will be used to refinance existing debt and fund a dividend to shareholders.

Harbor Freight is a Camarillo, Calif.-based provider of tools and equipment.

Alinta joins calendar

Alinta Energy will hold a bank meeting at 2 p.m. ET in New York on Wednesday to launch $1.17 billion in seven-year senior secured covenant-light term loans, split between a $1.1 billion funded tranche and a $70 million delayed-draw tranche, according to a market source.

The company also plans on getting a A$240 million five-year revolver.

Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., BNP Paribas Securities Corp., Goldman Sachs Bank USA and Macquarie Capital are leading the deal that will be used to refinance existing debt.

Commitments are due on July 31, the source added.

Alinta is a Melbourne, Australia-based power company.

Midcontinent on deck

Midcontinent Communications scheduled a call for 2 p.m. ET on Wednesday to launch a $475 million credit facility (BB-) that will be used to refinance an existing credit facility, according to a market source.

The facility consists of a $125 million five-year revolver, a $125 million five-year term loan A, and a $225 million seven-year term loan B that is talked at Libor plus 300 bps with a 1% Libor floor and a par offer price, the source said.

SunTrust Robinson Humphrey Inc., RBC Capital Markets, Wells Fargo Securities LLC, U.S. Bank and TD Securities (USA) LLC are leading the deal.

Commitments are due on Monday, the source added.

Senior leverage is 2.2 times.

Midcontinent Communications is a Sioux Falls, S.D.-based provider of cable television, local and long-distance digital telephone service and high-speed internet access.

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