McGraw-Hill $1.58 billion term loan allocates, trades higher; ATI Physical upsizes, tightens

By Paul A. Harris

Portland, Ore., May 2 – Bank loans traded with a decent tone as May got underway in the leveraged loan market on Monday, a trader said.

Being invested remains a challenge, the source added.

“We’re seeing a lot of bank loan paper trade above par, and we’re wondering whether that means there will be another round of refinancings,” the trader remarked.

The most recent fund flow numbers for the retail bank loan accounts were negative. The funds saw $35 million of daily outflows on Friday, a market source said.

In the primary market McGraw-Hill Global Education Holdings LLC’s term loan allocated and traded higher.

McGraw-Hill priced its upsized $1,575,000,000 six-year first-lien covenant-light term loan (Ba3/BB-) with a 500-basis-points spread to Libor at 99.50, a trader said.

The deal was up a point on the break, added the trader who saw it at 100½ offered.

ATI Physical Therapy upsized its seven-year first-lien term loan (B1/B) to $660 million from $635 million.

Spread talk tightened to Libor plus 450 bps from 500 bps. As before, the spread will float atop a 1% Libor floor.

The discount firmed at 99. Previous discount talk was 98 to 99.

And Calpine Corp. was scheduled to participate in a lender call on Monday.

The Houston-based energy company is seeking to syndicate a $500 million first lien term loan B-7.

Citigroup Global Markets is leading the deal.

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