Frac Tech, TASC, iPayment break; Lee Enterprises dips; Potters, Golden Nugget tweak deals

By Sara Rosenberg

New York, May 3 - Frac Tech International LLC's term loans hit the secondary market on Tuesday with levels quoted above their original issue discount price, and TASC Inc. and iPayment Holdings Inc. freed up as well.

Also in trading, Lee Enterprises Inc.'s term loan plummeted on the back of the withdrawal of its refinancing transactions, and Charter Communications Inc.'s bank debt was unchanged to softer following news of an expected paydown.

Over in the primary, Potters Industries Inc. reduced pricing and the discount on its first- and second-lien term loans, and Landry's Golden Nugget Atlantic City downsized its deal for a second time, while lowering pricing and modifying call protection.

Additionally, Epicor Software Corp. and Dave & Buster's Inc. began circulating guidance their credit facilities, and Gundle/SLT Environmental Inc. and Terra-Gen Finance Co. LLC surfaced with new deal plans.

Frac Tech starts trading

Frac Tech International's $1.7 billion of term loans (B2/B+) broke for trading on Tuesday, with levels on the strip of debt quoted at 99¾ bid, par ¼ offered on the open and then it moved up to par bid, par ½ offered, according to a trader.

Pricing on the term loans is Libor plus 475 basis points with a step-down to Libor plus 450 bps, subject to the repayment of $500 million of the debt with initial public offering proceeds and leverage being under 2.0 times. There is a 1.5% Libor floor and 101 soft call protection for one year.

The debt is comprised of a $1.5 billion five-year funded term loan B and a $200 million delayed-draw term loan.

The funded term loan was sold at an original issue discount of 99, and the delayed-draw loan was offered at 99¾ and includes a 250 bps unused fee. If the delayed-draw is funded at close, the original issue discount will be 99.

Frac Tech being bought

Proceeds from Frac Tech's term loans will be used to help fund the acquisition of a controlling stake in Frac Tech Services LLC by an investor group, including Temasek Holdings Ltd. and RRJ Capital from the Wilks family.

Furthermore, the proceeds will be used to fund a dividend payment to Chesapeake Energy Corp., which owns 30% of Frac Tech.

Bank of America Merrill Lynch and Citigroup Global Markets Inc. are the lead banks on the credit facility.

Frac Tech is a Cisco, Texas-based oilfield service company.

TASC frees up

TASC's credit facility also made its way into the secondary market, with the $575 million term loan B due December 2015 quoted at par ½ bid, 101½ offered and then levels tightened to par ½ bid, 101 offered, according to a market source.

Pricing on the B loan, as well as on a $100 million revolver due December 2014, is Libor plus 325 bps with a 1.25% Libor floor. The term loan B was sold at an original issue discount of 99½ and includes 101 soft call protection for six months.

Barclays Capital Inc., Deutsche Bank Securities Inc., KKR Capital Markets and RBC Capital Markets are the bookrunners on the $675 million senior secured credit facility (Ba2) that is being used to refinance existing bank debt.

TASC is a Chantilly, Va.-based provider of advanced systems engineering and technical assistance to the defense, intelligence, federal and homeland security markets.

iPayment tops par

Another deal to begin trading was iPayment Holdings, with its $375 million six-year term loan B quoted at par 3/8 bid, par ¾ offered on the open and then it moved up to par ½ bid, par 7/8 offered, according to a trader.

Pricing on the B loan is Libor plus 425 bps, after flexing from talk of Libor plus 450 bps to 475 bps, with a 1.5% Libor floor, and it was sold at a discount of 991/2, tightened from 99. There is 101 soft call protection for one year.

The $450 million senior secured credit facility (Ba2) also includes a $75 million revolver.

JPMorgan, Bank of America Merrill Lynch, RBC Capital Markets LLC and UBS Securities LLC led the deal that will be used by the Nashville-based provider of credit and debit card payment processing services to refinance existing bank debt, redeem senior subordinated notes and make a distribution to the its indirect parent, iPayment Investors LP.

Lee trades down

Lee Enterprises' term loan weakened in reaction to the company's decision not to move forward with its refinancing, with one trader quoting the debt at 87 bid, 88 offered, down from 90 bid, 95 offered and a second trader quoting it at 88 ¼ bid, 89 ¼ offered, down from 89 bid, 92 offered.

Late Monday, the company said that as a result of market conditions, it will no longer proceeds with plans to offer $680 million of first-priority lien senior secured notes due in 2017, $375 million of second-priority lien senior secured notes due in 2018 and up to 8,928,175 shares of common stock.

The notes offering had gone through a number of changes since coming to market, including most recently seeing the second-lien notes shift to a second-lien term loan format.

Proceeds from the new debt were going to be used by the Davenport, Iowa-based newspaper publisher to refinance substantially all of its existing debt.

Charter fairly steady

Charter Communications' bank debt was pretty much flat to slightly lower as word surfaced that the company will repay some credit facility debt with notes proceeds, according to traders.

One trader saw the term loan B-1 at 99 7/8 bid, par 1/8 offered, down from par bid, par ¼ offered, and the term loan C at par 3/8 bid, par 5/8 offered, down from par ½ bid, par ¾ offered.

A second trader, however, had the term loan B-1 at par bid, par ¼ offered, versus par bid, par 3/8 offered on Monday, and the term loan C at par ¼ bid, par ½ offered, versus par 1/8 bid, par ½ offered.

Early in the morning, Charter revealed plans for a $1 billion senior unsecured notes offering, which was later upsized to $1.5 billion, and proceeds from those notes will be used to pay down borrowings under one or more term loans and the company's revolving credit facility.

Charter is a St. Louis-based broadband communications company and cable operator.

Potters cuts pricing

Moving to the primary, Potters Industries modified pricing and original issue discount on its first- and second-lien term loans due to strong demand and has asked for recommitments by 2 p.m. ET on Wednesday, according to market sources.

Under the changes, the $150 million six-year first-lien term loan (Ba3/B) is priced at Libor plus 450 bps, down from Libor plus 475 bps, with a 1.5% Libor floor and an original issue discount of 99, revised from 981/2. There is still 101 soft call protection for one year.

Meanwhile, the $112.5 million 61/2-year second-lien term loan (Caa1/CCC+) is priced at Libor plus 850 bps, down from Libor plus 875 bps, with a 1.75% Libor floor and a discount of 99, tightened from 981/2, sources said. There continues to be call protection of 104 in year one, 103 in year two, 102 in year three and 101 in year four.

Potters getting revolver

Potters' $302.5 million credit facility, which is being led by J.P. Morgan Securities LLC, also provides for a $40 million five-year revolver (Ba3/B).

The deal is in connection with the company's spin-off from PQ Corp., a Malvern, Pa.-based producer of specialty chemicals and catalysts, and proceeds will be used to pay down borrowings under PQ's credit facility.

After completion of the spin-off, Potters and PQ will operate as separately managed companies held by common owners the Carlyle Group, Ineos Group and PQ management.

The transaction is expected to close this month.

Potters is a Malvern, Pa.-based producer of engineered glass materials for the highway safety, polymer additive, metal finishing and other specialty end markets.

Golden Nugget reworks deal

Landry's Golden Nugget also made a number of changes to its credit facility, including reducing the total size to $65 million from a most recent amount of $95 million and from an initial size at launch of $110 million, according to a market source.

The deal is structured as a $10 million 41/2-year first-out first-lien revolver and a $55 million five-year last-out first-lien term loan. Most recently, the deal had the same structure but the term loan was sized at $85 million. And, at launch, it was comprised of a $10 million revolver (B1/BB-) and a $100 million term loan (Caa1/B+).

Pricing on the revolver and the term loan is Libor plus 850 bps, down from Libor plus 950 bps, while the 1.5% Libor floor and original issue discount of 96 were left unchanged, the source continued.

Also call protection on the term loan was revised to non-callable until July 1, 2012, then at 106 for six months, 102 for one year and 101 for the following year, from non-callable until Jan. 1, 2013, then at 103 for one year and at 101½ for the following year.

Golden Nugget ups equity

Proceeds from Landry's Golden Nugget's credit facility will be used to fund the purchase, renovation and rebranding of the Trump Marina Hotel and Casino in Atlantic City by Tilman J. Fertitta, chairman, president, chief executive officer and owner of Landry's Inc., a full-service restaurant, hospitality and entertainment company.

As part of the changes to the financing structure, Fertitta increased the amount of equity it is using to $72 million from $45 million and has agreed to hold $37 million of new subordinated PIK debt, the source added.

As before, there is a $15 million completion guarantee. This feature was added at the time of the last downsizing.

Jefferies & Co. is the lead bank on the deal and is asking for recommitments by 3 p.m. ET on Thursday.

Epicor guidance emerges

Epicor Software held a bank meeting on Tuesday afternoon to launch its proposed $945 million senior secured credit facility, and in connection with the event, price talk was announced, according to a market source.

The $870 million seven-year covenant-light term loan is being talked at Libor plus 375 bps with a 1.25% Libor floor and an original issue discount of 99 to 991/2, the source said.

The revolver is being talked at Libor plus 375 bps as well, with step-downs to Libor plus 350 bps at 3.5 times total net first-lien leverage and to Libor plus 325 bps at 3.0 times total net first-lien leverage. The commitment fee is 75 bps with a step-down to 50 bps when total first-lien leverage is below 3.0 times.

Price talk on the tranches came pretty much in line with what was outlined in the commitment letter, except that the discount on the term loan had been outlined at just 99.

Epicor lead banks

Bank of America Merrill Lynch and RBC Capital Markets LLC are the joint lead arrangers and bookrunners on Epicor's credit facility that will be used to fund Apax Partners' buyout of the company for $12.50 per share in cash and the buyout of Activant Solutions Inc. from Hellman & Friedman LLC, Thoma Bravo, LLC and JMI Equity.

Other funds for the transaction will come from $465 million of senior unsecured notes due in 2019 and $647 million of equity.

Closing is expected to take place in the second quarter, subject to the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and other customary conditions.

Epicor is an Irvine, Calif.-based provider of enterprise business software services. Activant is a Livermore, Calif.-based technology provider of ERP and point-of-sale software.

Dave & Buster's floats talk

Continuing on the price talk theme, Dave & Buster's started telling lenders that its proposed $148.5 million covenant-light term loan B is being guided at Libor plus 400 bps with a 1.5% Libor floor and a par offer price, according to a market source.

The loan, which also includes soft call protection of 102 in year one and 101 in year two, is set to launch with a bank meeting on Wednesday.

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

Dave & Buster' is a Dallas-based operator of entertainment/dining complexes.

Gundle/SLT readies deal

Gundle/SLT Environmental has scheduled a bank meeting for 11:30 a.m. ET on Thursday to launch a proposed up to $210 million credit facility that is being led by Jefferies & Co. and GE Capital Markets, according to market sources.

The facility consists of a $40 million to $45 million revolver, a $125 million first-lien term loan and a $40 million second-lien term loan, sources said, adding that price talk is not yet available.

But, it is known that the first-lien term loan will have 101 soft call protection for one year, and the second-lien term loan will have call protection of 102 in year one and 101 in year two, sources added.

Proceeds will be used to refinance existing ABL credit facility debt and notes.

First-lien leverage is 3.5 times and total leverage is 4.8 times.

Gundle/SLT is a Houston-based manufacturer and marketer of geosynthetic lining products and services.

Terra-Gen coming soon

Terra-Gen Finance is set to launch a $360 million senior secured credit facility on Thursday, according to a news release, with Goldman Sachs & Co. and Credit Suisse Securities (USA) LLC the joint lead arrangers and bookrunners on the deal.

The facility consists of a $60 million five-year working capital revolver and a $300 million six-year term loan B.

Proceeds will be used to fully repay existing corporate level debt, fund a cash distribution to parent company Terra-Gen Power LLC and help fund a debt service reserve.

Terra-Gen, a New York-based renewable energy provider, expects to close on the facility late this month.

Rentech launches

In other news, Rentech Energy Midwest Corp. launched its $170 million six-year term loan with a bank meeting on Tuesday at previously outlined talk of Libor plus 650 bps with a 1.5% Libor floor and an original issue discount of 98, according to a market source. There is call protection of 102 in year one and 101 in year two.

Credit Suisse Securities (USA) LLC is the lead bank on the deal that will be used to refinance the company's 2010 senior secured credit facility and fund a dividend.

Rentech Energy is an East Dubuque, Ill.-based manufacturer and seller of nitrogen fertilizer products and is a subsidiary of Los Angeles-based Rentech Inc., a provider of clean energy services.

Iasis Healthcare closes

Iasis Healthcare LLC, a Franklin, Tenn.-based owner and operator of medium-sized acute care hospitals, completed its $1.325 billion credit facility, consisting of a $300 million five-year revolver (Ba3/BB-) and a $1.025 billion seven-year term loan B (Ba3/B), according to a news release.

Pricing on the revolver is Libor plus 350 bps and it was sold with a 150 bps upfront fee, and pricing on the B loan is Libor plus 375 bps with a 1.25% Libor floor, it was sold at a discount of 99½ and includes 101 soft call protection for one year.

During syndication, the term loan B was increased from $935 million as a bond offering was downsized to $850 million from $935 million, pricing firmed at the tight end of the Libor plus 375 bps to 400 bps talk and the Libor floor was cut from 1.5%.

Bank of America Merrill Lynch, Barclays Capital Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. and J.P. Morgan Securities LLC led the deal that was used to refinance existing debt, to fund a $230 million dividend and to help fund the acquisition of St. Joseph Medical Center.

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