Walter Investment, TriMas, Ducommun, Medpace break; Embanet-Compass speeds up deadline

By Sara Rosenberg

New York, June 17 - Walter Investment Management Corp.'s credit facility made its way into the secondary market on Friday, with term loan levels quoted fairly in line with their original issue discounts, while TriMas Corp., Ducommun Inc. and Medpace Inc. freed up atop their discount prices.

Over in the primary market, Embanet-Compass Knowledge Group accelerated the commitment deadline on its credit facility due to strong demand, and Primedia Inc. nailed down timing on the launch of its credit facility while also revealing structure.

Also, inVentiv Health disclosed that it will be coming to market with a term loan add-on, and Cellular South Inc., Norit Holding and Crown Media Holdings Inc. surfaced with new deal plans.

Walter begins trading

Walter Investment Management's $500 million five-year first-lien term loan (B1/B+) and $265 million 51/2-year second-lien term loan (B3/B) were quoted at 98 bid, 98½ offered upon freeing up for trading on Friday, according to a market source.

Pricing on the first-lien term loan and on a $45 million five-year revolver is Libor plus 625 basis points, and pricing on the second-lien loan is Libor plus 1,100 bps, with all tranches having a 1.5% Libor floor. Both terms loans were sold at an original issue discount of 98. Call protection on the first-lien term loan is 102 in year one and 101 in year two, and on the second-lien loan is non-callable for two years, then at 103 in year three and 101 in year four.

During syndication, pricing on the revolver and first-lien term loan was increased from Libor plus 525 bps, pricing on the second-lien was raised from Libor plus 900 bps, the discounts on both terms loans widened from 99, call protection on the first-lien term loan was sweetened from 101 for one year, and call protection on the second-lien was revised from 103 in year one, 102 in year two and 101 in year three.

Walter acquiring GTCS

Proceeds from Walter Investment's credit facility, from cash on hand and the issuance of 1.8 million shares of common stock will be used to fund the acquisition of GTCS Holdings LLC (Green Tree), a St. Paul, Minn.-based fee-based business services company, which provides high-touch, third-party servicing of credit-sensitive consumer loans, in a transaction valued at $1.065 billion.

Credit Suisse Securities (USA) LLC and RBS Securities Inc. are the joint bookrunners and lead arrangers on the $810 million senior secured credit facility

Leverage through the first-lien is 2.22 times and through the second-lien is 3.36 times.

Closing on the transaction is expected in the third quarter, subject to customary conditions, including receipt of governmental approvals and third-party consents.

Walter Investment is a Tampa, Fla.-based asset manager, mortgage servicer and mortgage portfolio owner.

TriMas frees up

TriMas' credit facility (Ba2/BB) also started trading, with the $225 million six-year term loan B quoted at 99¾ bid, par ½ offered on the open and then it moved up to par bid, par ¾ offered, according to a trader.

Pricing on the term loan B is Libor plus 300 bps, after flexing down from talk of Libor plus 325 bps to 350 bps. There is a 1.25% Libor floor and 101 soft call protection for one year, and it was sold at an original issue discount of 991/2.

The company is also getting a five-year revolver.

J.P. Morgan Securities LLC is leading the deal that will be used by the Bloomfield Hills, Mich.-based provider of engineered and applied products to refinance existing debt.

The company was considering coming to market in March with a $225 million term loan for the same purposes, but it was postponed due to market conditions.

Ducommun hits secondary

Another deal to break was Ducommun, with its $190 million six-year term loan B quoted at 99¾ bid, par ½ offered on the open, trading a couple of times in that context and then moving to par bid, according to a trader.

Pricing on the term loan B, as well as on a $60 million five-year revolver, is Libor plus 425 bps with a 1.25% Libor floor. The term loan B was sold at an original issue discount of 99 and has 101 soft call protection for one year.

During syndication, the revolver was upsized from $40 million and pricing on the entire facility was increased from initial talk of Libor plus 400 bps.

UBS Securities LLC and Credit Suisse Securities (USA) LLC are the joint lead arrangers and bookrunners on the $250 million senior secured credit facility (Ba2/BB-).

Ducommun selling notes

In addition to the credit facility, Ducommun plans on issuing $200 million of senior unsecured notes that are backed by a commitment for a $200 million senior unsecured bridge loan with pricing of Libor plus 675 bps if ratings are B3/B- and Libor plus 750 bps if ratings are lower, with a 1.25% Libor floor.

Proceeds from the credit facility and bonds will be used to fund the acquisition of LaBarge Inc. for $19.25 per share in cash, or $310.3 million, and refinance debt at both companies.

Closing is expected in the second quarter, subject to approval of LaBarge shareholders and certain other customary conditions, including expiration of applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

Ducommun is a Carson, Calif.-based provider of engineering and manufacturing services to the aerospace and defense industry. LaBarge is a St. Louis-based supplier of electronics manufacturing services.

Medpace bid above OID

Medpace's credit facility began trading as well, with the $285 million term loan quoted at 98¾ bid, according to a trader.

Pricing on the term loan and on a $50 million revolver is Libor plus 500 bps with a 1.5% Libor floor, and the debt was issued at an original issue discount of 981/2. The term loan has 101 hard call protection for one year.

Pricing on the $335 million facility (B2/B+) was flexed up from Libor plus 400 bps, the discount widened from 99 and call protection was added to the term loan during the syndication process.

Senior leverage is 4.5 times.

Jefferies & Co., Barclays Capital Inc., Bank of America Merrill Lynch and SunTrust Robinson Humphrey Inc. are leading the deal that will be used to help fund the buyout of the Cincinnati-based drug development company by CCMP Capital Advisors LLC from management.

API heads higher

API Technologies Inc.'s $170 million five-year term loan B inched up to 97½ bid, 98½ offered on Friday after breaking at 97 bid, 98 offered during the previous session, according to a market source.

Pricing on the B loan is Libor plus 625 basis points with a 1.5% Libor floor, and it was sold at an original issue discount of 961/2. There is 101 soft call protection for one year.

During syndication, the term loan B was downsized from $200 million, pricing was raised from talk of Libor plus 450 bps to 475 bps, the Libor floor was lifted from 1.25% and the original issue discount widened from guidance of 99 to 991/2.

The company funded the term loan B on June 1 and disclosed in an 8-K filed with the Securities and Exchange Commission that pricing was being discussed at Libor plus 600 bps with a 1.5% Libor floor.

However, the filing also said that for up to 90 days following the date of the credit agreement, terms were subject to market flex provisions in order to facilitate syndication of the term loan.

API buys Spectrum

Proceeds from API's $185 million senior credit facility (B2/BB-), which also includes a $15 million three-year revolver that was downsized from $20 million, were used to help fund the acquisition of Spectrum Control Inc. for $20 per share, or about $270 million.

Morgan Stanley & Co. Inc. acted as the lead bank on the deal.

Other funds for the transaction came from equity, which was upsized to account for the term loan downsizing.

API is a Ronkonkoma, N.Y.-based provider of secure communications, electronic components and subsystems and contract manufacturing services to the defense and aerospace industries. Spectrum is a Fairview, Pa.-based designer and manufacturer of high performance, custom services for the defense, aerospace, industrial and medical industries.

Embanet moves deadline

Moving to the primary, Embanet-Compass changed the commitment deadline for its $130 million credit facility to Tuesday from Thursday as a result of overwhelming interest from investors, according to a market source.

The facility consists of a $5 million five-year revolver and a $125 million six-year term loan, with both tranches talked at Libor plus 450 bps with a 1.25% Libor floor and an original issue discount of 99.

Credit Suisse Securities (USA) LLC, BNP Paribas Securities Corp. and BMO Capital Markets Corp. are the lead banks on the deal.

Proceeds will be used to refinance existing debt.

Embanet-Compass is a Chicago-based provider of online learning services to universities and colleges.

Primedia details emerge

Primedia revealed on Friday that its previously disclosed $315 million debt financing commitment will come in the form of a new credit facility that will launch with a bank meeting at 10:30 a.m. ET on Tuesday, a market source told Prospect News.

The facility consists of a $40 million five-year revolver that will undrawn at close and a $275 million seven-year term loan B, the source said.

Price talk is not yet available, the source added.

Bank of America Merrill Lynch, Barclays Capital Inc., UBS Securities LLC and RBC Capital Markets LLC are the lead banks on the deal.

Primedia being acquired

Proceeds from Primedia's credit facility, along with equity, will be used to fund the buyout of the company by TPG Capital for $7.10 per share in cash. The transaction enterprise value is approximately $525 million.

Closing is expected in the third quarter, subject to customary conditions, including expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

Stockholders holding roughly 58% of Primedia's common stock have executed a written consent approving the deal, and, as a result, no additional stockholder action is required.

Primedia is a Norcross, Ga.-based provider of Internet, mobile and print guides to help people find apartments, houses for rent or new homes for sale.

inVentiv coming soon

inVentiv is launching a term loan add-on to investors with a bank meeting at 10 a.m. ET on Tuesday, according to a market source, who said that details on size and price talk are not yet available.

Citigroup Global Markets Inc., Bank of America Merrill Lynch and Jefferies & Co. Inc. are the lead banks on the deal.

Proceeds will be used to help fund the acquisition of PharmaNet Development Group from JLL Partners Inc. The transaction was announced last month, at which time it was said that it would be financed with new debt.

Closing is expected on or about June 30, subject to customary conditions.

inVentiv is a Somerset, N.J.-based provider of clinical, consulting and commercial services to the health care industry. PharmaNet is a Princeton, N.J.-based provider of drug development services.

Cellular South readies deal

Cellular South will be holding a bank meeting on Monday to launch a proposed $800 million credit facility, according to a market source.

The facility consists of a $200 million revolver and a $600 million term loan B, the source said, adding that price talk is not yet available.

Bank of America Merrill Lynch is the lead bank on the deal that will be used to refinance existing debt.

Cellular South is a Ridgeland, Miss.-based privately held wireless provider.

Norit plans dividend recap

Norit Holding is set to hold a bank meeting on Monday to launch a $500 million credit facility that will be used to fund a distribution to shareholders and refinance existing debt, according to a market source.

The facility consists of a $50 million revolver, a $230 million six-year first-lien term loan, a €75 million six-year first-lien term loan and a $110 million 61/2-year second-lien term loan, the source said.

Price talk is not out yet, but it is known that the first-lien loans have 101 soft call protection for one year, and the second-lien loan call protection is 103 in year one, 102 in year two and 101 in year three.

Deutsche Bank Securities Inc. and Goldman Sachs & Co. are the lead banks on the deal.

Norit, a Netherlands-based producer of activated carbon and related services, will have leverage through the first-lien of 4.0 times and total leverage of 5.3 times.

Crown Media sets launch

Also coming out with new deals plans was Crown Media, as it scheduled a bank meeting for Thursday with a 2:30 p.m. ET start time at the W Hotel in New York to launch a proposed $240 million credit facility, according to a market source.

The facility consists of a $30 million five-year revolver and a $210 million seven-year term loan B, with price talk still to be determined, the source said.

J.P. Morgan Securities LLC is the lead bank on the deal, which will be used to refinance existing intercompany debt and preferred stock.

Crown Media is a Studio City, Calif.-based owner and operator of pay television channels, including the Hallmark Channel and Hallmark Movie Channel.

Ashland nets interest

In other news, Ashland Inc.'s $3.65 billion credit facility (BB) has good momentum, with commitments already coming in on the term loan B since its official launch on Thursday and the earlier senior managing agent round resulting in nine banks signing on to the transaction, according to a market source.

Banks that signed on as senior managing agents took some revolver and term loan A commitments, and were offered some term loan B as well.

As was previously reported, the facility consists of a $750 million five-year revolver and a $1.2 billion five-year term A, both being talked at Libor plus 225 bps, and a $1.7 billion seven-year term B talked at Libor plus 300 bps with a 1% Libor floor and an original issue discount of 991/2.

Commitments are due on June 30.

Ashland lead banks

Citigroup Global Markets Inc., Scotia Capital (USA) Inc., Bank of America Merrill Lynch and U.S. Bank are the joint lead arrangers and bookrunners on Ashland's credit facility.

Proceeds, along with cash on hand, will be used to fund the acquisition of International Specialty Products Inc., a Wayne, N.J.-based specialty chemical manufacturer of functional ingredients and technologies, for $3.2 billion in cash.

Pro forma for the transaction, secured debt to adjusted EBITDA is 3.2 times, secured net debt to adjusted EBITDA is 2.7 times, total debt to adjusted EBITDA is 3.5 times, and total net debt to adjusted EBITDA is 2.9 times.

Closing is expected prior to the end of the September quarter, subject to satisfaction of customary conditions and receipt of U.S. and European Union regulatory approvals.

Ashland is a Covington, Ky.-based provider of specialty chemical products and services.

NRG shuts revolver book

Commitments were due on Friday on NRG Energy Inc.'s $2.3 billion revolver, which is expected to wrap in line with talk at Libor plus 275 bps with a 50 bps unused fee, according to a market source.

Upfront fees on the revolver were 75 bps for commitments of $25 million, 100 bps for commitments of $35 million and 125 bps for commitments of $50 million.

The Princeton, N.J.-based power generation company's $3.9 billion senior secured deal (Baa3) also includes a $1.6 billion term loan B that wrapped up on June 10 at pricing of Libor plus 300 bps with a 1% Libor floor and was sold at a discount of 993/4. The B loan has 101 soft call protection for one year.

Morgan Stanley & Co. Inc., Bank of America Merrill Lynch, Barclays Capital Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC and RBS Securities Inc. are the joint bookrunners on the deal that will be used to refinance existing bank debt.

Cloverhill oversubscribed

Cloverhill Bakery's $165 million credit facility has filled out, resulting in talk being narrowed down to Libor plus 400 bps from previous guidance of Libor plus 400 bps to 450 bps, according to a market source.

The facility is still being talked with a 1.5% Libor floor and an original issue discount of 99.

Whether there will be a pricing flex on the transaction is still to be determined, the source added.

GE Capital Markets is the lead bank on the deal that consists of a $10 million revolver and a $155 million term loan, and will be used to refinance existing debt.

Cloverhill is a Chicago-based pre-packaged pastry company.

Silgan terminates commitments

Silgan Holdings Inc. cancelled its financing commitments for the purchase of Graham Packaging Co. Inc. since its acquisition agreement was terminated as a result of Reynolds Group Holdings Ltd. offering Graham a higher purchase price, according to an 8-K filed with the SEC.

Silgan was planning on getting a $4 billion senior secured credit facility (Ba1/BBB-), consisting of an $800 million five-year revolver, a $900 million six-year term loan A and a $2.3 billion seven-year term loan B, and $400 million of senior subordinated unsecured notes for the acquisition.

Deutsche Bank Securities Inc., Bank of America Merrill Lynch, Citigroup Global Markets Inc. and Wells Fargo Securities LLC were the lead banks on Silgan's debt financing.

Reynolds plans debt

As was previously reported, Reynolds expects to get $5 billion of new debt and use cash on hand for its purchase of Graham.

Reynolds is buying Graham for $25.50 per share, or a total of $4.5 billion including assumed debt, compared to Silgan's offer of 0.402 shares of Silgan common stock and $4.75 in cash per share, representing a total enterprise value, including net debt, of $4.1 billion.

The transaction is expected to close in the second half of this year, subject to customary regulatory approvals and closing conditions, including the approval of Graham's stockholders.

Pro forma for the acquisition, Reynolds Group's leverage ratio is expected to increase by 0.5 times.

Reynolds Group is an Auckland, New Zealand-based manufacturer and supplier of consumer food and beverage packaging and storage products. Graham is a York, Pa.-based supplier of plastic containers. And Silgan is a Stamford, Conn.-based manufacturer of consumer goods packaging products.

Warnaco closes

Warnaco Group Inc. announced in a news release on Friday that it completed its $200 million seven-year covenant-light term loan B (Ba1/BBB-).

Pricing on the B loan is Libor plus 275 bps, after firming recently at the low end of the Libor plus 275 bps to 300 bps talk. There is a 1% Libor floor and 101 soft call protection for one year, and the debt was sold at an original issue discount of 991/2.

J.P. Morgan Securities LLC was the lead bank on the deal that is being used to refinance existing debt and for general corporate purposes, including funding internal growth and acquisitions, and repurchasing common stock.

Warnaco is a New York-based designer, marketer and distributor of intimate apparel, sportswear and swimwear.

Calpine wraps loan

Calpine Corp. completed its $360 million first-lien senior secured covenant-light term B-2 (B1/NA/BB) due in 2018 that is priced at Libor plus 325 bps with a 1.25% Libor floor, according to a news release. The tranche was sold at 99¼ and has 101 soft call protection until March 2012.

Morgan Stanley & Co. Inc. acted as the lead bank on the deal that was used to retire credit agreements totaling $340.4 million belonging to the company's wholly owned subsidiaries Deer Park Energy Center LLC and Metcalf Energy Center LLC.

Calpine is a Houston-based power company.

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