Tallgrass talks $1.28 billion; Fortescue $4.5 billion launches Wednesday; Leap tightens talk

By Paul A. Harris

Portland, Ore., Oct. 2 - Tallgrass Energy Partners LP set pricing for its $1.275 billion senior secured credit facility (Ba3/BB+) as the primary market remained very active.

Leap Wireless International Inc. tightened the spread talk for its $400 million term loan (Ba2/B+).

There were also bank meeting and investor call announcments.

Fortescue Metals Group will hold a bank meeting on Wednesday for its $4.5 billion five-year covenant-light senior secured credit facility.

The LCDX 18 bank loan index ended the Tuesday session 1/16 of a point lower at par 15/16 bid, 101 7/16 offered.

Tallgrass facility

Tallgrass Energy said that pricing for the $150 million five-year revolver was set at Libor plus 400 basis points, discounted to 99, with a 50 bps undrawn fee.

The $875 million six-year term loan comes with a 400 bps Libor spread with a 1.25% Libor floor at 99 and 101 soft call for one year.

The $250 million delayed-draw six-year term loan comes with a Libor spread of 400 bps at 99, a 50 bps undrawn fee and 10% amortization in 2015, 15% amortization in 2016 and 20% amortization in 2017.

Commitments are due on Oct. 16.

Barclays is the bookrunner on the deal and a joint lead arranger with Bank of America Merrill Lynch, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and RBC Capital Markets LLC.

Proceeds, along with equity, will be used to help fund the acquisition of assets from Kinder Morgan Energy Partners LP and for working capital purposes.

Leap tightens talk

Leap Wireless tightened spread talk for its $400 million term loan (Ba2/B+) to Libor plus 350 bps. Previous talk was 400 to 425 bps.

The deal's 1.25% Libor floor remains unchanged, as does the original issue discount of 99.

The loan has 101 soft call protection for one year, the source said.

Commitments are due on Thursday.

Deutsche Bank Securities Inc., UBS Securities LLC and Bank of America Merrill Lynch are the lead banks on the deal.

Proceeds will be used to refinance $300 million of outstanding 10% senior notes due 2015 and for general corporate purposes.

Landmark Aviation meeting

A lenders' meeting for Landmark Aviation's $390 million of credit facilities is set for Thursday morning.

The deal is comprised of a $260 million seven-year first-lien term loan and a $130 million eight-year second-lien term loan.

Morgan Stanley & Co, RBC Capital Markets and Barclays are the joint lead arrangers.

Proceeds will be used to fund the buyout of Landmark Aviation by Carlyle Group LP.

Fortescue starts Wednesday

Fortescue Metals will hold a bank meeting on Wednesday for its $4.5 billion five-year covenant-light senior secured credit facility.

Credit Suisse and J.P. Morgan Securities LLC are the lead banks on the deal.

Proceeds will be used to refinance all of the company's existing bank debt and to provide additional liquidity.

The facility extends the earliest repayment date for any of the company's debt to November 2015 and removes financial maintenance covenants that applied under previous facilities, the release said.

Hyland brings $575 million

Hyland Software, Inc. will present $575 million of credit facilities at a bank meeting on Thursday afternoon in Miami.

Credit Suisse Securities (USA) LLC is the lead.

The deal is comprised of a $320 million seven-year first-lien term loan talked at Libor plus 475 to 500 bps with a 1.25% Libor floor, discounted to 99, with 101 repricing protection.

In addition, there is a $235 million 7.5-year second-lien term loan talked at Libor plus 875 to 900 bps with a 1.25% Libor floor, discounted to 98.5. The second-lien tranche becomes callable at 103 in year one, 102 in year two and 101 in year three.

There is also a $20 million five-year revolver.

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

Insight's $310 million

Insight Pharmaceuticals plans to launch $310 million of credit facilities (expected ratings B1/B+) via GE Capital.

The deal is comprised of a $20 million four-year revolver and a $290 million four-year first-lien term loan.

Pricing is Libor plus 500 basis points with 1.25% Libor floor at 99.5 with 101 soft call protection for one year.

Proceeds will be used to refinance the existing first-lien term loan, along with a $38 million upsizing.

A $112 million amount of the existing second-lien debt stays in place.

Vantage bank meeting

Vantage Drilling Co. will host a Wednesday afternoon bank meeting that will be led by Citigroup.

The size and structure of the deal have not been announced.

In a Tuesday press release, however, the company announced that it is seeking $1.125 billion of new senior secured debt to fund the tender offer for a portion of its 11½% senior secured first-lien notes due 2015.

In addition, Vantage Drilling has an additional $500 million of new senior secured debt, the proceeds of which would be used for the final construction payment of the Tungsten Explorer, the company's new deepwater drillship currently under construction.

Shelf Drilling loan, bonds

Shelf Drilling International Holdings, Ltd. plans to privately place $475 million of six-year senior secured notes late in the Oct. 8 week.

The deal will be marketed alongside a $75 million 5.5-year term loan.

Jefferies & Co. is the placement agent for the notes and the arranger for the loan.

Proceeds, along with $645 million of equity, will be used to finance the acquisition of 38 drilling rigs from Transocean Inc. for $1.05 billion.

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