UPC, Rural/Metro start trading in the 101s; Resorts International oversubscribed on day of launch

By Sara Rosenberg

New York, March 3 - UPC Financing Partnership's term loan H allocated and broke for trading on Thursday, with the paper moving rather quickly into the upper 101 range after initially opening in the low 101s. Also breaking for trading on Thursday was Rural/Metro Corp., with its term loan B quoted in the 101s as well.

In the primary, Resorts International Holdings LLC, an affiliate of Colony Capital LLC, has already gotten enough orders in to over fill the books on its term loans even though the bank meeting just took place on Thursday.

UPC's U.S. term loan H opened for trading at 101 bid, 101 3/8 offered and then rapidly headed up to 101½ bid, 101¾ offered where it pretty much closed the session, according to one trader.

A second trader said that he saw bids on UPC's U.S. tranche around 101 5/8 and offers ranging anywhere from 101¾ to 10 7/8 by the end of the day.

UPC's €550 million term loan H piece was quoted at 101 bid, 101 3/8 offered by the end of the day, the second trader added.

The $1.25 billion seven-year U.S. term loan H, which was upsized from $600 million, is priced with an interest rate of Libor plus 275 basis points (rate locked in for six months) with a step down to Libor plus 250 basis points when leverage falls below 4x. The tranche had been reverse flexed during syndication from Libor plus 300 basis points with a step down to Libor plus 275 basis points when leverage falls below 4x.

The term loan H contains a $500 million or its euro equivalent accordion feature.

UPC Financing is a subsidiary of Denver-based broadband network business UnitedGlobalCom Inc.

UnitedGlobalCom's European broadband subsidiary, UPC Distribution Holdings BV, is also working a new deal, as it is in-market with a new €850 million term loan G with an interest rate of Libor plus 250 basis points. The euro tranche does not contain a call protection provision but is being offered with upfront fees of 75 basis points for commitments of up to $35 million, 100 basis points for commitments of $36 million to $50 million in size, 125 basis points for commitments of $51 million to $70 million in size and 150 basis points for any commitments larger than $70 million.

Proceeds from the two term loans will be used to refinance the company's existing term loan B and the existing term loan C, which carry an interest rate of Libor plus 550 basis points, and refinance the term loan E, which carries an interest rate of Libor plus 300 basis points and matures in 2009.

The decision to refinance the term loan E was made when the company opted to upsize the term loan H.

Bank of America, Royal Bank of Scotland and ABN Amro are the lead banks on both term loans.

Rural/Metro breaks

Rural/Metro's $135 million term loan B due 2011 opened around 101¼ bid, 101¾ offered and then saw the bid side tick up to 101 3/8 by the end of the day, while the offer stayed at 1013/4, according to a market source.

The tranche, which was upsized from $120 million after the company priced a senior subordinated notes offering that was downsized to $125 million from $140 million, is priced with an interest rate of Libor plus 250 basis points. Pricing was reverse flexed from original price talk of Libor plus 350 basis points during syndication.

Rural/Metro's $190 million senior secured credit facility (B2/B) also contains a $35 million institutional letter-of-credit facility due 2011 with an interest rate of Libor plus 250 basis points (upsized from $15 million to gain extra liquidity and reverse flexed from original price talk of Libor plus 350 basis points during syndication) and a $20 million revolver due 2010 with an interest rate of Libor plus 325 basis points (reverse flexed from original price talk of Libor plus 350 basis points during syndication).

Proceeds from the facility will be used to help fund the tender offer for the company's $150 million 7 7/8% senior notes due 2008 and repay revolver debt.

Citigroup and JPMorgan are the lead banks on the credit facility, with Citigroup the left lead.

Rural/Metro is a Scottsdale, Ariz., provider of emergency and non-emergency medical transportation, fire protection and other safety services.

Resorts International fills up

Resorts International's term loans were both oversubscribed by Thursday afternoon, and price talk on the first-lien term loan actually came out at the low end of initial talk, while price talk on the second lien has yet to be released, according to a market source.

The $585 million term loan B (B+) was launched with opening pricing of Libor plus 325 basis points, the source said. Prior to the bank meeting the tranche was talked in the Libor plus 325 to 350 basis point range.

Pricing on the $400 million second-lien term loan (B-) was not revealed at the meeting, the source added, but prior to launching sources speculated that it would be coming in the Libor plus 700 basis points area.

Resorts International's $1.06 billion credit facility also contains a $75 million revolver (B+).

Deutsche Bank and Goldman Sachs are joint bookrunners on the deal, with Deutsche the left lead.

Proceeds will be used to help fund Colony Capital's acquisition of four casinos - two properties from Harrah's Entertainment Inc. and two properties from Caesars Entertainment Inc.

Colony, a Los Angeles-based real estate investment fund, will acquire Harrah's East Chicago and Harrah's Tunica for about $627 million and Caesars' Atlantic City Hilton and Bally's Tunica for about $612 million.

Telcordia cuts B spread

Telcordia Technologies Inc. lowered pricing on its $570 million term loan B to Libor plus 200 basis points from Libor plus 250 basis points, according to a market source.

This is the second change made to the term loan B since launch. The other week, the syndicate opted to upsize the institutional term loan by $50 million from $520 million after downsizing the company's bond offering to $300 million from $350 million.

Pricing on the $100 million revolver was left unchanged at Libor plus 250 basis points, the source added.

Proceeds from the $670 million credit facility (B1/B+) and the $300 million senior subordinated notes due 2013 will be used to help fund the leveraged buyout of the company by Providence Equity Partners and Warburg Pincus for $1.35 billion in cash.

JPMorgan, Bear Stearns, Deutsche and Lehman are lead banks on the credit facility, with JPMorgan left lead.

Telcordia is a Piscataway, N.J, provider of telecommunications software and services for IP, wireline, wireless and cable.

Endurance Business Media cuts spread

Endurance Business Media Inc. reverse flexed its $100 million seven-year term loan B to Libor plus 275 basis points from price talk of Libor plus 325 basis points, according to a market source. Wachovia is the lead bank on the deal.

Proceeds from the $120 million credit facility (B1/B), which also includes a $20 million six-year revolver, will be used to refinance existing debt and fund a dividend payment to sponsor Kelso & Co.

Endurance Business Media is a Tallahassee, Fla., publisher of residential real estate and rental property advertising publications.

Allied Waste firms up pricing

Allied Waste Industries Inc. firmed up pricing on its $1.45 billion seven-year term loan B and $450 million institutional letter-of-credit facility at Libor plus 225 basis points, the low end of the Libor plus 225 to 250 basis points talk that the deal was launched with, according to market sources.

"The deal is in good shape," one source added about the institutional portion of the facility.

The $1.55 billion five-year revolver, which is still talked at Libor plus 275 basis points, is also in good shape as the company had already received commitments in excess of the $1.55 billion revolver before the actual bank meeting took place.

Proceeds from the $3.45 billion credit facility (B1/BB/BB-), along with proceeds from a proposed $100 million common stock issuance, $500 million three-year mandatory convertible preferred stock issuance and $600 million 10-year senior notes issuance, will be used to repay the remaining $195 million of 10% senior subordinated notes due 2009, repay $125 million of 9.25% senior notes due 2012, repay the $600 million 7.625% senior notes due January 2006, repay the $70 million 7.875% senior notes due March 2005 and fully repay amounts outstanding under the existing credit facility.

Basically with the new facility, the Scottsdale, Ariz., waste services company is increasing its existing revolver from $1.5 billion to enhance liquidity, and will also be downsizing its term loan by more than $100 million.

JPMorgan and Citigroup are the lead banks on the deal, with JPMorgan the left lead.

Greif closes

Greif Inc. closed on its new $350 million revolving credit facility with an initial interest rate of Libor plus 100 basis points. Deutsche Bank and Key Bank acted as joint lead arrangers on the deal, with Deutsche the left lead

Proceeds from this facility will be used to repay the company's existing revolver and term loan, and for other general corporate purposes.

"We are extremely pleased with this new facility," said Donald S. Huml, chief financial officer, in a company news release. "The terms of the facility are substantially equivalent to those typical for an investment-grade rated company - our near-term aspiration. This is further evidence of the significant improvement in our financial performance and credit profile."

Greif is a Delaware, Ohio, producer of industrial packaging products.

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