Seventy Seven Energy term B gains with earnings; National Veterinary price talk emerges

By Sara Rosenberg

New York, Feb. 17 – Seventy Seven Energy Inc.’s first-lien term loan B was stronger in trading during Wednesday’s market hours as the company released fourth quarter earnings results.

Meanwhile, on the deal front, National Veterinary Associates (NVA Holdings Inc.) released price talk on its incremental term loan with launch.

Seventy Seven rises

Seventy Seven Energy’s term loan B moved higher in the secondary market on Wednesday following the announcement of the company’s quarterly numbers, according to a trader.

The term loan B was quoted at 58 bid, 60 offered, up from 57 bid, 59 offered, the trader said.

For the fourth quarter, the company reported a net loss of $60.6 million, or $1.18 per fully diluted share, compared to a net loss of $9.4 million, or $0.20 per fully diluted share, for the fourth quarter of 2014.

Revenues for the quarter were $192.8 million, versus $494.9 million in the comparable period in 2014.

And, adjusted EBITDA for the fourth quarter of 2015 was $56.3 million, compared to $104.6 million in the prior year.

Seventy Seven bankruptcy?

Along with earnings news, Seventy Seven Energy reiterated in its press release that it has retained restructuring advisors and is actively exploring and evaluating various strategic alternatives to reduce the level of its long-term debt and lower its future cash interest obligations.

The strategies being examined include, among other things, debt repurchases, exchanges of existing debt securities for new debt securities and exchanges or conversions of existing debt securities into new equity securities.

The company went on to say that one or more of these strategic alternatives could potentially be done through voluntary bankruptcy proceedings.

“Based on current market conditions, the company believes that a restructuring of its long-term debt is needed to improve its financial position and flexibility and to better position it to take advantage of the growth opportunities that are likely to result from the current industry downturn,” the release added.

Seventy Seven Energy is an Oklahoma City-based provider of wellsite services and equipment to U.S. land-based exploration and production customers.

National Veterinary sets talk

National Veterinary Associates held its lender call on Wednesday morning, launching its $100 million incremental term loan (B1) with talk of Libor plus 450 basis points with a 1% Libor floor, an original issue discount of 97 to 97.5 and 101 soft call protection for one year, according to a market source.

Bank of America Merrill Lynch, Jefferies Finance LLC and Nomura are leading the debt that will be used for acquisition financing, general corporate purposes and to pay down revolver borrowings.

National Veterinary Associates is an Agoura Hills, Calif.-based owner of independent freestanding veterinary hospitals.

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