Reliant, Nautilus, TNT, Motorsport set talk; John Maneely retranches, floats guidance; Chemicals trade up

By Sara Rosenberg

New York, Nov. 13 - Reliant Energy Inc. released price talk on its credit facility as the deal was launched with a bank meeting Monday, and Nautilus Holdings Intermediate Corp. and TNT Logistics price talk started making its way around the market as the transactions are getting ready for their upcoming bank meetings.

In other primary news, Motorsport Aftermarket Group Inc. announced price talk on its in-market deal now that ratings have been made public, and John Maneely Co. tweaked tranching on its credit facility, resulting in an overall smaller deal size, and came out with price talk on its term loan.

Meanwhile, in the secondary, the chemical sector got a bit of a pick-me-up during Monday's session, with names like Huntsman International LLC, Georgia Gulf Corp. and Lyondell Chemical Co. all trading higher.

Reliant Energy held a bank meeting on Monday morning to kick off syndication on its $1.4 billion senior secured credit facility, and with the launch, price talk of Libor plus 250 basis points was announced on all tranches under the facility, according to a market source.

Tranching on the deal is comprised of a $700 million revolving credit facility, a $400 million institutional term loan and a $300 million prefunded synthetic letter-of-credit facility.

Deutsche Bank, Bank of America and JPMorgan are the lead banks on the deal, with Deutsche the left lead on the term loan and letter-of-credit facility and Bank of America the left lead on the revolver.

Proceeds will be used to refinance the company's $1.7 billion revolver, $531 million of term loan debt and $450 million receivables securitization facility.

Reliant Energy is a Houston-based provider of electricity and energy services.

Nautilus floats spread talk

Continuing on the price talk front, Nautilus Holdings guidance emerged at Libor plus 250 bps on both tranches contained under its proposed $1.325 billion credit facility that is scheduled to launch with a bank meeting on Tuesday, according to a market source.

Tranching on the deal is a $250 million six-year revolving credit facility and a $1.075 billion seven-year term loan B, to be divided into dollars and euros.

JPMorgan, General Electric Capital Corp. and UBS are the lead banks on the facility that will be used to fund Apollo Management, LP's leveraged buyout of General Electric Co.'s Advanced Materials business, which will be named Nautilus, for $3.8 billion in cash and securities.

Upon completion of the transaction, GE will receive a 10% ownership stake in the new company and hold $400 million of notes.

Nautilus is a Wilton, Conn.-based $2.5 billion supplier of silicone-based products, silanes, sealants, urethane additives and adhesives, and high-purity fused quartz and ceramics materials.

TNT price talk

TNT Logistics also came out with price talk of Libor plus 250 bps on all tranches under its proposed €805 million credit facility as the deal is gearing up for its bank meetings in New York on Tuesday and London on Wednesday, according to a market source.

Tranching on the facility consists of a €150 million revolver, a €155 million letter-of-credit facility and a €500 million term loan B.

Credit Suisse, Bear Stearns, Goldman Sachs and ABN Amro are the lead banks on the deal, with Credit Suisse the left lead.

Proceeds from the facility, along with €300 million in senior subordinated notes, €430 million in senior notes and about €310 million in equity, will be used to back Apollo Management, LP's already completed buyout of TNT NV's logistics division for €1.48 billion.

Total leverage is less than 5.0 times.

The logistics division is the No. 2 logistics company in the world, employing about 36,000 people, operating in 28 countries and managing 7.3 million square meters of warehouse space.

Motorsport talk surfaces

Motorsport Aftermarket Group was another name that came out with price talk, according to a market source, who said that the $160 million term loan is being guided at Libor plus 275 bps.

The deal, which was actually launched with a bank meeting on Nov. 3, has been waiting on, among other things, ratings before releasing opening pricing. This past Thursday, Standard & Poor's assigned a B rating to the $220 million deal. Moody's Investors Service had already assigned its Ba3 rating to the transaction on Nov. 2.

Goldman Sachs, Credit Suisse and UBS are the lead banks on the $220 million transaction that also includes a $60 million revolver, with Goldman the left lead.

Proceed from the facility, along with $110 million of mezzanine debt, will be used to help fund the leveraged buyout of Motorsport Aftermarket Group by Leonard Green & Partners LP.

Motorsport Aftermarket Group is a provider of aftermarket parts for motorcycles.

John Maneely reworks structure

Also in the primary Monday, John Maneely made some changes to its credit facility structure, including downsizing its asset-based revolver while upsizing its term loan by not quite the equivalent amount, according to a market source.

In addition, now that the tranche modifications were announced, and ratings from the credit agencies have been released, price talk on the term loan surfaced, the source said.

With the modifications, the asset-based revolver now carries a size of $400 million, down from an original size of $450 million, and the term loan now carries a size of $1.3 billion, up from $1.275 billion, the source remarked. Prior to the deal coming to market, it was expected that the term loan would carry a size of $1.225 billion, but the tranching was tweaked when the launch date firmed up.

Price talk on the term loan - which first emerged on Monday although the deal has been in-market since last Tuesday - is Libor plus 275 to 300 bps, the source added.

Sources had previously said that one of the reasons why pricing guidance was unavailable was that ratings were being waited on. However, that technicality was addressed once Moody's assigned a Ba2 rating to the asset-based revolver and a B3 rating to the term loan last Thursday, and S&P assigned ratings of BB on the revolver and B+ on the term loan last Wednesday.

Goldman Sachs and JPMorgan are the lead banks on the $1.7 billion deal (down from $1.725 billion), with Goldman the left lead.

Proceeds from the credit facility will be used to fund the merger of John Maneely with Atlas Tube, Inc.

John Maneely, a Carlyle Group portfolio company, is a Collingswood, N.J., manufacturer of steel pipe and tubular products. Atlas Tube is a Harrow, Ont., manufacturer of structural tube.

Chemical names stronger

Switching to the secondary, chemical names got about an eighth of a point pop on Monday as buyers stepped in for the paper, according to a trader, who said that the best examples were Huntsman, Georgia-Gulf and Lyondell.

"Over the past few weeks [chemical names] had softened by maybe a quarter to a half in certain spots. Buyers are coming in to buy the names that had come in," the trader said in explanation of the sector's performance.

Huntsman, a Salt Lake City-based chemical company, saw its term loan B close the day at par bid, par ¼ offered, up from previous levels of 99 7/8 bid, par 1/8 offered.

Georgia Gulf, an Atlanta-based manufacturer of commodity chemicals, vinyl resins and vinyl compounds, saw its term loan B close the day at par ½ bid, par ¾ offered, up from previous levels of par 3/8 bid, par 5/8 offered.

And, Lyondell, a Houston-based independent, publicly traded chemical company, saw its term loan B close the day at par ½ bid, par ¾ offered, up from previous levels of par 3/8 bid, par 5/8 offered.

Building Materials closes

Building Materials Holding Corp. closed on its amended and restated $850 million senior secured credit facility (Ba2/BB) consisting of a $500 million revolver due 2011 and a $350 million term loan B due 2013, according to a company news release.

The revolver is priced at Libor plus 125 bps, and the term loan B is priced at Libor plus 250 bps.

During syndication, pricing on the term loan B was flexed up from original talk at launch of Libor plus 225 bps.

In addition, during syndication, the total leverage covenant was reduced to 3.5 times from the originally proposed 4.5 times and the accordion feature was downsized to $250 million.

Wells Fargo, JPMorgan, SunTrust and BNP Paribas acted as the lead banks on the deal that was used to refinance existing debt.

Building Materials is a San Francisco-based provider of building products and construction services.

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