Royal Adhesives, U.S. Infrastructure, Tower Auto free up; RE/MAX, CDW, CeramTec revised

By Sara Rosenberg

New York, July 26 - Royal Adhesives and Sealants credit facility broke for trading on Friday, and United States Infrastructure Corp. and Tower Automotive Holdings USA LLC hit the secondary too.

Over in the primary, RE/MAX LLC reduced pricing on its term loan B and added a step-down based on leverage, CDW LLC revised the original issue discount on its incremental loan, and CeramTec GmbH lowered coupons on its U.S. and euro term loans while also tightening original issue discounts.

Furthermore, Photonis USA Pennsylvania Inc., LANDesk Software and International Equipment Solutions LLC came out with new deal plans.

Royal Adhesives breaks

Royal Adhesives and Sealants' credit facility emerged in the secondary market on Friday, with the $353 million five-year first-lien term loan B (B1/B) quoted at par 5/8 bid, 101 1/8 offered and the $154 million 51/2-year second-lien term loan (Caa2/CCC+) quoted at 101½ bid, 102½ offered, according to a trader.

Pricing on the first-lien term loan is Libor plus 425 basis points with a 1.25% Libor floor and it was sold at and original issue discount of 99. There is 101 soft call protection for one year.

The second-lien term loan is priced at Libor plus 850 bps with a 1.25% Libor floor and was sold at 98. This tranche is non-callable for one year, then at 102 in year two and 101 in year three.

Recently, the first-lien term loan was upsized from $350 million, pricing firmed at the tight end of the Libor plus 425 bps to 450 bps talk and the discount finalized at the low side of the 98 to 99 guidance. Also, the spread on the second-lien term loan came at the wide end of the Libor plus 825 bps to 850 bps talk, the discount firmed at the low end of the 97 to 98 talk and the call protection was revised from 103 in year one, 102 in year two and 101 in year three.

Royal getting revolver

Royal Adhesives' $547 million senior secured credit facility also provides for a $40 million five-year revolver (B1/B).

With the size and pricing adjustments the other day, the company cut the second-lien leverage cushion by 0.25 times to 7.25 times, trimmed the incremental basket to $50 million and lowered the restricted payment basket to $5 million, the source continued. The first-lien leverage cushion remained at 7 times.

Morgan Stanley Senior Funding Inc., Madison Capital and Jefferies Finance LLC are the joint bookrunners on the deal and joint lead arrangers with Nomura and KeyBanc Capital Markets LLC.

Proceeds will be used to fund the acquisition of ADCO Global and refinance existing bank debt. The funds from the first-lien term loan upsizing will pay for fees and expenses.

Royal Adhesives, a South Bend, Ind.-based manufacturer and marketer of high performance adhesives, sealants, encapsulants and specialty polymers, expects to close on the deal on Wednesday.

U.S. Infrastructure tops OID

United States Infrastructure's credit facility began trading too, with the $430 million covenant-light first-lien term loan (B2/B) seen at par ¾ bid, 101¼ offered, a trader remarked.

Pricing on the first-lien term loan is Libor plus 375 bps with a 1% Libor floor and it was sold at a discount of 991/2. The loan has 101 soft call protection for six months.

During syndication, pricing on the first-lien loan was reduced from talk of Libor plus 425 bps to 450 bps and the discount was modified from 99.

The company's $670 million credit facility also includes a $75 million revolver (B2/B), and a $165 million second-lien term loan (Caa2/CCC+) that was privately placed.

Deutsche Bank Securities Inc., General Electric Capital Corp. and RBC Capital Markets are leading the deal that will help fund the company's buyout by Leonard Green & Partners LP from Omers Private Equity, which is expected to close in the third quarter.

United States Infrastructure is an Indianapolis-based provider of outsourced utility locating services.

Tower Auto starts trading

Tower Automotive's $418.9 million senior secured term loan B due April 23, 2020 also freed up, with levels quoted at par ½ bid, 101¼ offered, a market source said.

Pricing on the loan is Libor plus 375 bps with a 1% Libor floor and it was issued at par. There is 101 soft call protection for six months.

Citigroup Global Markets and J.P. Morgan Securities LLC are leading the deal that is being used to reprice an existing term loan B from Libor plus 450 bps with 1.25% Libor floor.

Closing is targeted for Monday.

Tower Automotive is a Livonia, Mich.-based supplier of automotive metal structural components and assemblies.

RE/MAX flexes

Moving to the primary, RE/MAX LLC cut the spread on its $230 million seven-year term loan B to Libor plus 300 bps from talk of Libor plus 325 bps to 350 bps and added a step to Libor plus 275 bps when senior secured leverage is less than 2.25 times, net of up to $15 million of cash, according to a market source.

The term loan still has a 1% Libor floor and an original issue discount of 99¾ and includes 101 soft call protection for six months, the source said.

Commitments were due on Friday.

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

RE/MAX is a Denver-based real estate company.

CDW tweaks OID

CDW moved the original issue discount on its $190 million incremental term loan B (Ba3/B+) due April 2020 to 99¼ from talk of 98½ to 99, according to a market source.

As before, the loan is priced at Libor plus 250 bps with a step-down to Libor plus 225 bps at 4 times net total leverage and a 1% Libor floor, and includes 101 soft call protection through April 2014.

Commitments were due at noon ET on Friday, the source remarked.

J.P. Morgan Securities LLC is the left lead on the deal that will be used to refinance existing subordinated notes.

CDW is a Vernon Hills, Ill.-based provider of integrated information technology solutions.

CeramTec reworks deal

CeramTec lowered pricing on its U.S. equivalent term loan B to Libor plus 350 bps from talk of Libor plus 400 bps to 425 bps and on its euro term loan B to Euribor plus 400 bps from talk of Euribor plus 425 bps to 450 bps, and also revised the discount prices to 99½ from 99, according to a market source.

In addition, the MFN sunset was extended to 24 months from 12 months, the source said.

As before, the €647.5m equivalent U.S./euro seven-year covenant-light B loans have a 1% floor and 101 soft call protection for six months.

The company's €747.5 million credit facility (Ba3/B), for which recommitments were due at the close of business on Friday, also includes a €100 million five-year revolver.

Deutsche Bank Securities Inc., RBC Capital Markets and UBS Securities LLC are leading the deal.

CeramTec being bought

Proceeds from CeramTec's credit facility will be used to help fund its €1.49 billion buyout by Cinven from Rockwood Holdings Inc.

Also funding the transaction is €306.7 million of eight-year senior notes that priced on Thursday at par to yield 8¼%.

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.

Photonis readies deal

Also on the new deal front, Photonis set a bank meeting for 2:30 p.m. ET in New York on Tuesday to launch $325 million in first- and second-lien term loans and has already began circulating price talk on the debt, according to a market source.

The $260 million six-year covenant-light first-lien term loan is talked at Libor plus 500 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, and the $65 million 61/2-year covenant-light second-lien term loan is talked at Libor plus 900 bps with a 1% Libor floor, a discount of 98 and call protection of 103 in year one, 102 in year two and 101 in year three, the source said.

Commitments are due on Aug. 13.

Credit Suisse Securities (USA) LLC is leading the deal that will be used to refinance existing debt.

Photonis is a Lancaster, Pa.-based manufacturer of vacuum electron devices and associated RF circuits for communications, science, radar, industry & directed energy applications.

LANDesk returning

LANDesk Software will hold a call on Tuesday to launch a $320 million credit facility that is being led by Jefferies Finance LLC, according to a market source.

The facility consists of a $20 million revolver and a $300 million seven-year term loan talked at Libor plus 425 bps to 450 bps with a 1% Libor floor and an original issue discount of 99, the source said.

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

The company had tried to do a dividend recapitalization not too long ago, but that deal was pulled in June.

The shelved deal, led by BMO Capital Markets Corp. and Credit Suisse Securities (USA) LLC, consisted originally of a $25 million five-year revolver and a $330 million seven-year term loan B talked at Libor plus 375 bps to 400 bps with a 1% Libor floor and an original issue discount of 991/2.

Prior to being pulled, the term loan B had been downsized to $300 million and spread tlak had widened to Libor plus 425 bps to 450 bps.

LANDesk leverage

The source remarked that the structure on LANDesk's new deal, along with strong operating performance, results in a 4 times leverage versus 4.7 time in June, and LTM EBITDA has improved to $75 million compared to $69.5 million when marketed in June.

Also, the company has seen a 20% increase in new bookings year to date and is forecasting continued growth, the source added.

LANDesk is a South Jordan, Utah-based provider of systems lifecycle management and endpoint security, as well as IT service management for desktops, servers and mobile devices.

International Equipment on deck

International Equipment Solutions scheduled a bank meeting for 10:30 a.m. ET on Monday to launch a $270 million six-year term loan B (B2) that will be used to refinance existing debt, according to market sources.

Bank of America Merrill Lynch, J.P. Morgan Securities LLC and PNC Capital Markets LLC are leading the deal.

International Equipment is an Oak Brook, Ill.-based manufacturer of highly engineered cab enclosures and attachment tools.

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