Busch Entertainment breaks; First Data dips on earnings; New deals continue to be well received

By Sara Rosenberg

New York, Nov. 13 - Busch Entertainment Corp.'s credit facility hit the secondary market on Friday morning with levels on the term loan moving up from the original issue discount price at which investors purchased the paper during syndication.

Also in trading, First Data Corp.'s term loan debt headed lower after the company released third-quarter numbers that showed a wider net loss and lower adjusted EBIDTA when compared to the previous year's results.

In other news, the recent trend of new deals in market getting positive attention from lenders still seems to be in effect as RehabCare Group Inc., JohnsonDiversey Inc. and Princeton Review Inc. are all heard to be moving along nicely.

Busch frees to trade

Busch Entertainment's buyout credit facility broke for trading on Friday morning and the $1.05 billion term loan was seen trading above its original issue discount price, according to a trader.

The term loan was quoted at 99¾ bid, par ¼ offered on the break and then it inched its way higher reaching par ¼ bid, par ½ offered by the afternoon, the trader said.

Pricing on the term loan is Libor plus 350 basis points with a 2.25% Libor floor, and it was sold at an original issue discount of 981/2.

During syndication, the term loan was upsized from $1 billion, since the deal was oversubscribed, and the mezzanine financing was downsized to $400 million from $450 million.

And, prior to launching to a select audience - there was never a general syndication bank meeting - the term loan was increased from $950 million and the equity was reduced to $975 million.

Busch also getting revolver

Busch Entertainment's $1.175 billion credit facility (Ba2/BB+) also includes a $125 million revolver.

The revolver was originally expected at $100 million, but it was increased prior to launching when the first term loan upsizing took place.

Proceeds from Busch's credit facility will be used to help fund the buyout of the company by the Blackstone Group from Anheuser-Busch InBev for $2.3 billion in cash plus the right to participate in Blackstone's return on its initial investment capped at $400 million.

Bank of America Merrill Lynch, Barclays, Deutsche Bank, Goldman Sachs and Mizuho Corporate Bank are the lead banks on the deal.

Closing of the transaction is subject to customary conditions, including regulatory clearance.

Busch Entertainment is an entertainment park operator.

First Data slides

First Data's term loan debt softened on Friday following the release of quarterly earnings that were less than impressive, according to traders.

One trader had the term loan B-1 quoted at 85¼ bid, 86¼ offered, down from 85¾ bid, 86¾ offered, the term loan B-2 quoted at 85 bid, 86 offered, down from 85½ bid, 86½ offered and the term loan B-3 quoted at 84¾ bid, 85¾ offered, down from 85¼ bid, 86¼ offered.

Meanwhile, a second trader had the term loan B-1 quoted at 85 3/8 bid, 85 7/8 offered, down from 85 7/8 bid, 86 3/8 offered, the term loan B-2 quoted at 85¼ bid, 85¾ offered, down from 85¾ bid, 86¼ offered and the term loan B-3 quoted at 85 bid, 85½ offered, down from 85½ bid, 86 offered.

First Data net loss worsens

For the third quarter, First Data reported a net loss of $288.9 million, down 76% from a net loss of $164.4 million in the comparable period last year.

Adjusted EBITDA for the quarter was $532 million, down 23% compared to $688.5 million in the third quarter of 2008.

However, revenues for the quarter were up 13% at $2.443 billion, compared to $2.164 billion last year primarily driven by a new Bank of America Merchant Services alliance. Bank of America Merchant Services is the company's largest merchant acquiring alliance and was established in June after the extension of similar alliances with Wells Fargo and PNC in recent quarters.

First Data is a Greenwood Village, Colo.-based provider of electronic commerce and payment services.

Primary catches good interest

Switching to the primary market, the overall tone still seems to be a positive one as deals like RehabCare, JohnsonDiversey and Princeton Review are all being described as "going well" by various sources.

RehabCare, a St. Louis-based provider of physical rehabilitation services, is in market with a $625 million senior secured credit facility (Ba3/BB), comprised of a $125 million revolver and a $500 million term loan B, with both tranches talked at Libor plus 400 bps. The term loan B has a 2% Libor floor and is being offered at an original issue discount of 98.

Bank of America, RBC and BNP Paribas are the lead banks on the RehabCare deal that will be used to help fund the company's acquisition of Triumph HealthCare for a purchase price of $570 million.

JohnsonDiversey, a Sturtevant, Wis.-based provider of commercial cleaning, sanitation and hygiene products, is in market with a $450 million U.S. term loan B that is talked at Libor plus 350 bps to 375 bps with a 2% Libor floor and an original issue discount of 981/2. One source guessed that pricing would end up at the tight end of talk given the level of interest in the deal.

Citigroup, GE Capital, Goldman Sachs and JPMorgan are the joint bookrunners on the JohnsonDiversey deal (Ba2/BB-/BB-) that will be used to help fund a recapitalization transaction valued at $2.6 billion.

And, Princeton Review, a Framingham, Mass.-based provider of college and graduate school test preparation and private tutoring, is in market with a $96 million senior secured credit facility, consisting of a $15 million revolver and an $81 million term loan, with both tranches talked at Libor plus 600 bps with a 2% Libor floor and an original issue discount of 97.

GE Capital is the lead bank on the Princeton Revies deal that will be used to help fund the company's acquisition of Penn Foster Education Group Inc. from the Wicks Group of Cos. LLC for $170 million in cash.

TowerCo OID talk

Also on the primary front, TowerCo is talking its $200 million five-year term loan B with an original issue discount in the 98 to 99 context, according to a market source.

As was previously reported, spread guidance on the term loan B is Libor plus 400 bps to 425 bps with a 2% Libor floor.

Morgan Stanley and Jefferies are the lead banks on the deal that was launched with a bank meeting on Thursday afternoon

The company's $240 million credit facility also includes a $40 million three-year revolver.

Proceeds will be used to pay a dividend to sponsors.

TowerCo is a Cary, N.C.-based developer, owner and leaser of communication towers.

Primary Energy closes

Primary Energy Recycling Corp. closed on its $105 million five-year secured term loan (Ba1/BB+) priced at Libor plus 450 bps with a 2% Libor floor, according to a news release.

Credit Suisse acted as the lead bank on the deal that was used, along with proceeds from a rights offering, to repay the company's $131 million term loan.

Covenants include maximum leverage and minimum fixed-charge coverage ratios.

Primary Energy is an Oak Brook, Ill.-based owner and operator of recycled energy projects and a pulverized coal facility.

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