Rackspace, Entercom, Evoqua, Filtration break; Genoa, Jacobs Douwe, Live Nation, ABB revised

By Sara Rosenberg

New York, Oct. 26 – Rackspace Hosting Inc.’s credit facility made its way into the secondary market on Wednesday, with the term loan B trading above its original issue discount, and Entercom Communications broke too.

Also, Evoqua Water Technologies (EWT Holdings III Corp.) modified the issue price on its tack-on first-lien term loan and Filtration Group Corp. finalized the original issue discount on its incremental first-lien term loan B at the tight end of guidance, and then both of these deals freed up for trading as well.

In more happenings, Genoa, A QoL Healthcare Co. LLC shifted some funds between its first- and second-lien term loans and lowered pricing on both tranches, and Jacobs Douwe Egberts trimmed spreads and tightened issue prices on its U.S. and euro term loans.

Furthermore, Live Nation Entertainment Inc. lowered price talk on its term loan B, ABB/Con-Cise Optical Group LLC changed issue price talk on its incremental first-lien term loan B and Harsco Corp. accelerated the commitment deadline on its term loan B.

Additionally, Bass Pro Group LLC, Camping World Good Sam and Chromaflo Technologies LLC released talk with launch, and TricorBraun, Telesat, DTZ (DTZ U.S. Borrower LLC and DTZ AUS Holdco Pty Ltd.), Netsmart Technologies Inc. and Sirva are getting ready to bring new deals to market.

Rackspace frees up

Rackspace’s credit facility began trading on Wednesday, with the $2 billion seven-year covenant-light term loan B quoted at 100¼ bid, 100¾ offered, according to a trader.

Pricing on the term loan B is Libor plus 400 basis points with a 1% Libor floor and an original issue discount of 99.5. The debt has 101 soft call protection for six months.

During syndication, pricing on the term loan B was reduced from Libor plus 425 bps and the discount was tightened from 99.

The company’s $2,225,000,000 senior secured credit facility (Ba2/BB+/BB+) also includes a $225 million five-year revolver.

Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Barclays, RBC Capital Markets and Credit Suisse Securities (USA) LLC are leading the deal.

Rackspace being acquired

Proceeds from Rackspace’s credit facility will be used to help fund the buyout of the company by Apollo Global Management LLC for $32.00 per share in cash. The transaction has a total value of $4.4 billion.

Along with the credit facility, $1.2 billion of eight-year senior unsecured notes, $1,258,000,000 of equity and $434 million of balance sheet cash are expected to be used for the buyout.

Pro forma for the transaction, net secured leverage is 2.5 times and net total leverage is 4 times based on LTM June 30 pro forma adjusted EBITDA of $810 million.

Closing is targeted for early-to-mid November, subject to the conclusion of the applicable antitrust waiting periods in the United States, the European Union and Israel, stockholder approval and other customary conditions.

Rackspace is a San Antonio-based managed cloud company.

Entercom hits secondary

Entercom’s credit facility broke for trading too, with the $480 million seven-year term loan B seen at 100¼ bid, 100¾ offered, a trader said.

Pricing on the term loan B is Libor plus 350 bps with a 1% Libor floor, and it was sold at an original issue discount of 99.75. The debt has 101 soft call protection for six months.

During syndication, the term loan B was upsized from $460 million, the spread was reduced from Libor plus 375 bps, and the discount was changed from talk of 99 to 99.5.

The company’s $540 million senior secured credit facility (B1/BB-) also includes a $60 million five-year revolver.

Bank of America Merrill Lynch, Morgan Stanley Senior Funding Inc., RBC Capital Markets and Wells Fargo Securities LLC are leading the deal that will be used to refinance existing bank debt and notes.

Entercom is a Bala Cynwyd, Pa.-based broadcaster.

Evoqua tweaks OID, breaks

Evoqua Water Technologies changed the original issue discount on its fungible $150 million tack-on first lien term loan (B2/B) due Jan. 15, 2021 to 99.75 from 99.25, according to a market source.

Pricing on the tack-on term loan matches existing first-lien term loan pricing at Libor plus 375 bps with a 1% Libor floor, and the debt is getting 101 soft call protection for six months.

Recommitments were due at noon ET and then the debt made its way into the secondary market in the afternoon with levels quoted at par bid, 100½ offered, another source said.

Credit Suisse Securities (USA) LLC is leading the deal that will be used to refinance a revolver draw and existing second-lien term loan borrowings, and for general corporate purposes.

With this transaction, existing lenders are being offered a 25-bps consent fee for an amendment.

Evoqua is a Warrendale, Pa.-based provider of equipment and services for water treatment.

Filtration firms terms, trades

Filtration Group set the original issue discount on its $341 million incremental first-lien term loan B (B2/B) due November 2020 at 99.5, the tight end of the 99 to 99.5 talk, a market source said.

Pricing on the term loan B is Libor plus 325 bps with a 1% Libor floor, and the debt has 101 soft call protection through June 30, 2017. Also, $237 million of the incremental loan is delayed-draw with a ticking fee of half the margin from days 31 to 60 and the full margin thereafter.

With final terms in place, the incremental term loan B freed up for trading, and levels were quoted at 99¾ bid, 100¼ offered, the source continued.

Goldman Sachs Bank USA and BMO Capital Markets are leading the deal that will be used to fund an acquisition and pay down second-lien term loan borrowings.

Closing on the funded piece is expected during the week of Oct. 31 and closing on the delayed-draw piece is expected prior to March 31, 2017, the source added.

Filtration Group is a Chicago-based manufacturer and distributor of filtration products to end market.

BWIC announced

Also in trading, a Bid Wanted In Competition surfaced for which bids are due at 1 p.m. ET on Thursday, according to a trader.

Some of the names in the portfolio include Aramark Corp., BJ’s Wholesale Club Inc., Cumulus Media Holdings Inc., Envision Healthcare Corp., Goodyear Tire & Rubber Co., Huntsman International LLC, Kronos Inc., NXP BV, Realogy Group LLC, Sports Authority Inc. and Valeant Pharmaceuticals International Inc.

There are about 48 issuers in the BWIC, the trader added.

Genoa changes emerge

Back in the primary market, Genoa, A QoL Healthcare lifted its seven-year first-lien term loan to $620 million from $600 million and trimmed the spread to Libor plus 375 bps from Libor plus 425 bps, while leaving the 1% Libor floor, original issue discount of 99.5 and 101 soft call protection for six months intact, a market source remarked.

As for the eight-year second-lien term loan, it was decreased to $160 million from $180 million and pricing was reduced to Libor plus 800 bps from Libor plus 825 bps, the source continued. This tranche still has a 1% Libor floor, a discount of 98.5 and call protection of 102 in year one and 101 in year two.

Another revision made was that the MFN sunset was removed.

The company’s $830 million credit facility also includes a $50 million revolver.

Recommitments were due at 5 p.m. ET on Wednesday, the source added.

Credit Suisse Securities (USA) LLC is leading the deal that will be used to refinance existing debt and fund a dividend to shareholders.

Genoa is a Tukwila, Wash.-based provider of mental health pharmacy services.

Jacobs Douwe flexes

Jacobs Douwe Egberts cut pricing on its $903 million term loan B (BB) due July 2022 to Libor plus 250 bps from Libor plus 275 bps and on its €1,101,000,000 billion term loan B (BB) due July 2022 to Euribor plus 225 bps from talk of Euribor plus 250 bps to 275 bps, and modified the issue price on both tranches to par from 99.875, according to a market source.

The term loans still have a 0.75% floor.

Recommitments are due at noon ET on Thursday, the source said.

J.P. Morgan Securities LLC, Bank of America Merrill Lynch and HSBC are leading the deal that will be used to refinance/reprice existing term loan debt.

Jacobs Douwe is a Netherlands-based coffee company.

Live Nation tweaks deal

Live Nation Entertainment reduced price talk on its $975 million seven-year term loan B (Ba2/BB) to a range of Libor plus 250 bps to 275 bps from a range of Libor plus 275 bps to 300 bps, according to a market source.

As before, the term loan has no Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months.

J.P. Morgan Securities LLC is leading the deal that will be used with $575 million of senior notes to refinance existing bank debt and notes, and for general corporate purposes.

Live Nation is a Beverly Hills, Calif.-based provider of live music concerts and live entertainment ticketing sales and marketing services.

ABB updates talk

ABB/Con-Cise modified the issue price talk on its fungible $48 million senior secured covenant-light incremental first-lien term loan B (B1/B) due June 15, 2023 to a range of 99.5 to par from just 99.5 and accelerated the commitment deadline to 5 p.m. ET on Wednesday from Friday, according to a market source.

The loan is priced at Libor plus 500 bps with a 1% Libor floor and has 101 soft call protection until December 2016.

Morgan Stanley Senior Funding Inc. is leading the deal that will be used to repay revolver borrowings used to fund an acquisition.

ABB/Con-Cise is a Coral Springs, Fla.-based optical distributor.

Harsco shutting early

Harsco moved up the commitment deadline on its $550 million seven-year term loan B to 5 p.m. ET on Thursday from Tuesday, a market source said.

The term loan B is talked at Libor plus 550 bps with a 1% Libor floor, an original issue discount of 98 and 101 soft call protection for one year.

Pricing is targeted for Friday, the source added.

The company’s $950 million senior secured credit facility (Ba1/BB) also includes a $400 million five-year revolver.

Goldman Sachs Bank USA, Citigroup Global Markets Inc., HSBC Securities (USA) Inc., Bank of America Merrill Lynch, RBC Capital Markets, US Bank and KeyBanc Capital Markets are leading the deal that will be used to amend and extend an existing credit facility and redeem 5¾% senior notes due 2018.

Harsco is a Camp Hill, Pa.-based diversified engineered products and services company.

Bass Pro launches

Also on the new deal front, Bass Pro Group released talk of Libor plus 425 bps with a 0.75% Libor floor, an original issue discount of 99 and 101 soft call protection for six months on its $3.37 billion seven-year covenant-light term loan B (B+) that launched with a bank meeting on Wednesday, according to a market source.

Commitments are due on Nov. 4, the source said.

Bank of America Merrill Lynch, Wells Fargo Securities LLC, Citigroup Global Markets Inc., RBC Capital Markets, UBS Investment Bank and Goldman Sachs Bank USA are leading the deal that will be used to help fund the acquisition of Cabela’s Inc. for $65.50 per share in cash, or about $5.5 billion.

Closing is expected in the first half of 2017, subject to approval by Cabela’s shareholders, regulatory approvals and other customary conditions.

Bass Pro is a Springfield, Mo.-based outdoor retailer. Cabela’s is a Sidney, Neb.-based marketer and retailer of hunting, fishing, camping and outdoor merchandise.

Camping World sets talk

Camping World held its lender call, launching its $645 million senior secured term loan B due November 2023 (B1/BB+) with talk of Libor plus 375 bps with a 0.75% Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months, a market source remarked.

Commitments are due on Nov. 2, the source added.

Goldman Sachs Bank USA is leading the deal that will be used to refinance existing debt.

Camping World is a Lincolnshire, Ill.-based seller of RVs and supplier of RV parts, supplies and accessories.

Chromaflo discloses guidance

Chromaflo Technologies came out with price talk on its $530 million senior secured credit facility that launched with a morning bank meeting, according to a market source.

The $50 million five-year revolver (B2) is talked at Libor plus 400 bps with no floor, the $345 million seven-year covenant-light first-lien term loan B (B2) is talked at Libor plus 400 bps to 425 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, and the $135 million eight-year covenant-light second-lien term loan (Caa2) is talked at Libor plus 800 bps to 825 bps with a 1% Libor floor, a discount of 98.5 and hard call protection of 102 in year one and 101 in year two, the source said.

Commitments are due on Nov. 3.

Morgan Stanley Senior Funding Inc., Goldman Sachs Bank USA, KeyBanc Capital Markets and Jefferies Finance LLC are leading the debt that will be used to help fund the buyout of the company by American Securities.

Chromaflo is an Ashtabula, Ohio-based manufacturer of chemical and pigment dispersions for architectural and industrial coatings.

TricorBraun joins calendar

TricorBraun scheduled a lender meeting in New York for Nov. 9 to launch a $735 million credit facility, a market source said.

The facility consists of a $75 million revolver, a $600 million covenant-light term loan and a $60 million delayed-draw term loan, the source continued.

Antares Capital and Nomura are leading the deal that will be used to help fund the acquisition of the company by AEA Investors LP from CHS Capital.

TricorBraun is a St. Louis-based specialty distributor of plastic and glass packing products.

Telesat coming soon

Telesat set a call for Thursday to launch a $2.38 billion credit facility that consists of a $200 million five-year revolver and a $2.18 billion seven-year term loan B, according to a market source.

J.P. Morgan Securities LLC is leading the deal.

Proceeds will be used by the Ottawa-based fixed satellite services operator to help refinance existing debt.

DTZ plans refinancing

DTZ intends to hold a lender call at 11 a.m. ET on Friday to launch a $235 million add-on first-lien term loan due Nov. 4, 2021 that will be to refinance an existing second-lien term loan priced at Libor plus 825 bps with a 1% Libor floor, according to a market source.

Pricing on the add-on first-lien term loan is Libor plus 325 bps with a 1% Libor floor, and the original issue discount is still to be determined, the source said.

UBS Investment Bank is leading the deal.

DTZ, a TPG Capital portfolio company, is a real estate services company.

Netsmart readies loan

Netsmart Technologies will hold a lender call on Thursday to launch a repricing of its $395 million term loan and a $40 million incremental term loan both talked at Libor plus 425 bps with a 1% Libor floor and 101 soft call protection for six months, a source remarked.

The repricing, which will take the existing term loan down from Libor plus 475 bps with a 1% Libor floor, is offered at par and the incremental loan is offered at an original issue discount of 99.5, the source continued.

Proceeds from the incremental term loan will fund a tuck-in acquisition, the source added.

Golub Capital is leading the deal.

Netsmart is an Overland Park, Kan.-based IT company focused on health and human services.

Sirva on deck

Sirva set a bank meeting for 10 a.m. ET in New York on Thursday to launch a $350 million credit facility, split between a $50 million revolver and a $300 million first-lien term loan, according to a market source.

Goldman Sachs Bank USA and Jefferies Finance LLC are leading the deal that will be used to refinance existing debt.

Sirva is an Oakbrook Terrace, Ill.-based provider of end-to-end relocation and moving solutions to corporations, government agencies and individual consumers.

Augusta allocate

In other news, Augusta Sportswear Group’s $435 million credit facility (B1/B+) allocated and closed on Wednesday, according to a market source.

The facility consists of a $40 million five-year revolver, and a $395 million seven-year covenant-light term loan priced at Libor plus 450 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months.

During syndication, the excess cash flow sweep was increased to 75% from 50%, the incremental was reduced to 37.5 million from $75 million and it was outlined that the company has to host quarterly lender calls in addition to providing quarterly MD&A, the source said.

Antares Capital led the deal that was used to refinance existing debt.

Augusta Sportswear is an Augusta, Ga.-based manufacturer and supplier of team uniforms, spiritwear and dancewear.

MGM Growth closes

MGM Growth Properties Operating Partnership LP completed its $1,841,000,000 covenant-light term loan B priced at Libor plus 275 bps with a step-down to Libor plus 250 bps at corporate family ratings of Ba3/BB- and a 0.75% Libor floor, a news release said.

The loan was issued at par and has 101 soft call protection for six months.

Bank of America Merrill Lynch led the deal that was used to reprice an existing term loan B from Libor plus 325 bps with a 0.75% Libor floor.

MGM Growth Properties is a Las Vegas-based real estate investment trust engaged in the acquisition, ownership and leasing of large-scale destination entertainment and leisure resorts.

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