TransDigm, Entain term loans free to trade; Travel + Leisure, American Axle ready deals

By Sara Rosenberg

New York, Dec. 2 – TransDigm Inc. lowered pricing on its first-lien term loan H and finalized the issue price at the tight side of talk, and Entain plc modified the original issue discount on its U.S. add-on term loan B and set the discount on its euro term loan B at the tight end of revised guidance, and then both of these deals broke for trading on Friday.

In more happenings, Travel + Leisure Co. and American Axle & Manufacturing Inc. joined the near-term primary calendar with debt refinancing transactions.

TransDigm revised, breaks

TransDigm trimmed the spread on its $1.725 billion amended and extended first-lien term loan H due February 2027 to SOFR plus 325 basis points from SOFR plus 350 bps and firmed the original issue discount at 98, the tight end of the 97.5 to 98 talk, according to a market source.

The term loan still has 0 bps CSA, a 0% floor and 101 soft call protection for one year.

Recommitments were due at 12:30 p.m. ET on Friday and the debt began trading late in the day, with levels quoted at 98½ bid, 99¼ offered, another source added.

Goldman Sachs Bank USA is the left lead on the deal that will extend the maturity of the existing $1.725 billion term loan G from August 2024 and shift pricing to SOFR from Libor.

TransDigm is a Cleveland-based supplier of highly engineered aircraft components for use on commercial and military aircraft.

Entain tweaked

Entain changed the original issue discount on its fungible $375 million add-on term loan B due October 2029 to 98.75 from 98 and finalized the discount on its €800 million term loan B due June 2028 at 97.5, the tight end of revised talk of 97 to 97.5 and tighter than initial talk of 97, a market source remarked.

As before, the U.S. term loan is priced at SOFR+10 bps CSA plus 350 bps with a 0.5% floor, and the euro term loan is priced at Euribor plus 375 bps with a 0% floor. The euro term loan has 101 soft call protection for one year. Call protection on the add-on U.S. term loan is the same as the call protection on the existing U.S. term loan B.

Earlier in syndication, the U.S. term loan was upsized from $250 million and the euro term loan was upsized from €500 million.

The debt will be used to repay/extend in full a euro term loan due March 2024 and to cover transaction fees and expenses. Prior to the recent upsizings, the company was only planning on repaying/extending a portion of the March 2024 euro term loan.

Entain frees up

Recommitments for Entain’s U.S. term loan were due at 10:30 a.m. ET on Friday and the debt broke for trading in the afternoon, with levels quoted at 99 bid, 99½ offered, another source added.

The euro term loan is expected to price and allocate on Monday.

Deutsche Bank Securities Inc. is the left lead and sole physical bookrunner on the U.S. term loan and Barclays is a physical bookrunner. Barclays and Deutsche are the joint global coordinators and physical bookrunners on the euro term loan. Mandated lead arrangers include Lloyds, Mediobanca, Morgan Stanley Senior Funding Inc., Natwest, Santander and Credit Suisse. Wilmington Trust is the administrative agent.

Entain is a Douglas, Isle of Man-based sports-betting, gaming and interactive entertainment group, operating both online and in the retail sector.

American Axle refinancing

American Axle & Manufacturing will hold a question and answer call for lenders at 11 a.m. ET on Monday to launch a $650 million seven-year term loan B (BB+), a market source remarked. A pre-recorded lender presentation for the loan was available on Friday.

Talk on the term loan B is SOFR+10 bps CSA plus 375 bps with a 0.5% floor, an original issue discount of 96 and 101 soft call protection for six months, the source added.

Commitments are due at 5 p.m. ET on Thursday.

JPMorgan Chase Bank, Barclays, BMO Capital Markets, BofA Securities Inc., Citigroup Global Markets Inc., Mizuho and RBC Capital Markets are leading the deal that will be used to help refinance an existing term loan B.

American Axle is a Detroit-based producer of driveline and drivetrain systems and related components and chassis modules for the automotive industry.

Travel + Leisure on deck

Travel + Leisure set a lender call for 10:30 a.m. ET on Monday to launch a $300 million seven-year incremental term loan (BB-/BB+) talked at SOFR+10 bps CSA plus 425 bps to 450 bps with a 0.5% floor, an original issue discount of 97 and 101 soft call protection for six months, according to a market source.

Commitments are due at 5 p.m. ET on Thursday, the source added.

JPMorgan Chase Bank is the left lead on the deal. BofA Securities Inc. is the administrative agent.

The loan will be used with cash on hand and revolver borrowings to refinance the company’s 3.9% notes due 2023.

Travel + Leisure is an Orlando, Fla.-based membership and leisure travel company.

Fund flows

In other news, actively managed loan fund flows on Thursday were negative $60 million and loan ETFs were positive $65 million, market sources said.

Loan funds reported weekly outflows totaling $880 million, including negative $51 million ETFs. This was the 15th consecutive withdrawal and 24th in the past 26 weeks.

The past 15 weeks’ outflows totaled $13.5 billion or 16% of weekly AUM, sources added.

Net inflows for loan funds since the beginning of 2021 are down to $39.5 billion and dedicated loan fund AUM is down to $108 billion from as much as $142 billion in May.

Outflows for loans funds year to date total $7.2 billion, including negative $2.7 billion ETF.

Loan indices rise

IHS Markit’s iBoxx loan indices were stronger on Thursday, with the Leveraged Loan indexes (MiLLi) closing out the day up 0.04% and the Liquid Leveraged Loan indices (LLLi) closing out the day up 0.13%.

Month to date, the MiLLi is up 0.04% and year to date its down 1.59%. The LLLi is up 0.13% month to date and down 2.35% year to date.

Average secondary market bids in the U.S. on Thursday were 92.25, down 4.75% year to date.

According to the IHS Markit data, some of the top advancers on Thursday were Gulf Finance’s November 2021 extended term loan at 85.67, up from 81.95, Envision Healthcare’s October 2018 covenant-lite unvoted term loan at 28.88, up from 27.78, and GTT’s May 2018 U.S. covenant-lite term loan at 60.33, up from 59.

Some top decliners on Thursday were Wheel Pros’ May 2021 covenant-lite term loan at 60, down from 65.96, Mitel Networks’ November 2018 covenant-lite fourth out no roll-up term loan at 28.60, down from 30.88, and Eaglepicher’s February 2018 covenant-lite term loan B at 78.75, down from 83.09.

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