Travelport rises on equity news; Cenveo firm with amendment; Chemtura sets talk on DIP loan

By Sara Rosenberg

New York, Jan. 19 - Travelport Holdings Ltd.'s bank debt headed higher during Tuesday's trading session after the company revealed its intention to raise a substantial amount of money through the sale of equity.

Meanwhile, Cenveo Inc.'s strip of bank debt held steady in the secondary market as the company launched an amendment proposal to lenders that would allow for the issuance of senior secured bonds to repay term loan borrowings.

In other news, Chemtura Corp. came out with price talk on its newly launched debtor-in-possession financing facility, and Bucyrus International Inc. zeroed in on the size of its term loan B as the company firmed up plans to issue equity.

Also, Del Monte Corp.'s pro rata credit facility has good momentum and is expected to fill out by the commitment deadline set for later this week.

Travelport trades up

Travelport's strip of term loan and letter-of-credit facility debt, as well as its delayed-draw term loan, gained some ground in trading as the company announced plans to raise about $2 billion through the issuance of new shares, according to traders.

Of the total estimated proceeds, $1.775 billion would be raised through an initial public offering to institutions in the United Kingdom and to eligible institutional investors internationally, and $225 million would be raised from the sale of shares to Government of Singapore Investment Corp.

The transaction is expected to close in the first quarter of 2010, subject to market and other customary conditions.

On the back of the news, Travelport's strip of term loan and letter-of-credit facility debt was quoted at 97 bid, 98 offered, up from 95 bid, 96 offered, one trader said. A second trader had the debt quoted wider at 96½ bid, 98½ offered.

And, the delayed-draw term loan, which actually already funded, was quoted by the first trader at 97½ bid, 98½ offered, up from 95½ bid, 96½ offered.

Travelport repaying debt

Travelport said on Tuesday that all proceeds from the sale of its shares will be used to reduce its outstanding debt. According to the trader, however, the strip of term loan and letter of credit facility debt and the delayed-draw term loan will probably not see a paydown.

"Likely PIK holdco, term loan C and bonds that are higher coupon [will be repaid]," the first trader remarked.

He went on to explain that there are still three years left on the term loan, letter-of-credit facility and delayed-draw term loan, and this debt has a pretty low coupon so there's no reason to take it out now.

But, the trader does think that some of this term loan, letter-of-credit facility and delayed-draw term loan debt may be taken out in a year or so since the company's revolver matures in 2012.

Travelport is a Parsippany, N.J.-based travel distribution services company. In connection with the sale of shares, Travelport Holdings will change its name to Travelport plc.

Cenveo steady

Cenveo's strip of institutional bank debt was unmoved by the company's launch of an amendment proposal on Tuesday afternoon that would permit the sale of at least $350 million of senior secured bonds, according to sources.

Any funds raised in the bond market would be used to repay the company's term loan.

Following the news, the strip was quoted by one source at 99 bid, par offered and by a second source at 98 bid, with both sources calling the paper unchanged on the day.

Cenveo reducing revolver

In addition, as part of the amendment, Cenveo would downsize its revolving credit facility to $150 million from $172.5 million.

And, the amendment would make some modest changes made to financial covenants.

Bank of America is the administrative agent on the deal.

Lenders are being offered a 15 basis point consent fee and signatures are due on Jan. 25.

Cenveo is a Stamford, Conn.-based diversified printing company.

Chemtura talk emerges

Over in the primary market, Chemtura held a bank meeting on Tuesday afternoon to kick off syndication on its proposed $450 million debtor-in-possession financing credit facility, and in connection with the launch, price talk was announced, according to sources.

Both the $150 million revolver and the $300 million term loan were presented to lenders with talk of Libor plus 425 bps with a 2% Libor floor, sources said.

In addition, the term loan is being offered at an original issue discount in the 99 area, sources remarked.

Citigroup is the lead bank on the deal.

Chemtura is a Middlebury, Conn.-based manufacturer and seller of specialty chemicals and polymer products.

Bucyrus cuts B loan size

Bucyrus lowered the size of its six-year term loan B (Ba2/BB) to $1.075 billion from up to $1.2 billion since a definitive agreement has been reached to issue equity to Terex Corp., according to a market source.

Proceeds from the term loan B, along with the roughly 5.8 million shares of equity, will be used to fund the acquisition of Terex's mining equipment business for $1.3 billion. Terex is taking the stock in place of $300 million in cash.

When the acquisition was announced, the company actually said that it expected the term loan B to be sized at $1.075 billion even though the commitment is for $1.2 billion, but since the stock agreement had not yet been signed, the loan was launched at its maximum size.

Bucyrus price talk

Bucyrus' term loan B is being talked at Libor plus 325 bps, with a 2% Libor floor and an original issue discount of 99.

JPMorgan, Bank of America and Macquarie are the lead banks on the deal that is heard to be getting a nice amount of investor interest.

In connection with the acquisition, Bucyrus is also planning to get a $50 million revolver add-on and an amendment and extension of its existing credit facility.

Pro forma leverage would be 2.1 times.

Closing on the acquisition is expected to take place during the first quarter of 2010, subject to regulatory approvals and other customary conditions.

Bucyrus is a Milwaukee, Wis.-based designer and manufacturer of high-productivity mining equipment for surface and underground mining.

Del Monte progressing well

Syndication of Del Monte's $1.1 billion senior secured credit facility (Baa3) is said to be going very well, with the expectation being that the deal will be fully subscribed by the time the books close on Thursday, according to a market source.

The facility consists of a $500 million five-year revolver and a $600 million five-year term loan A, with both tranches talked at Libor plus 300 bps with no Libor floor.

The revolver and term loan A are being sold to lenders as a strip. Commitments of $50 million get a 62.5 bps upfront fee, while commitments of $25 million get a 37.5 bps fee.

Covenants include a maximum leverage ratio and a minimum fixed-charge coverage ratio.

Bank of America, BMO and Barclays are the lead banks on the deal that will be used to refinance existing debt.

Del Monte is a San Francisco-based producer, distributor and marketer of branded food and pet products.

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