Generac breaks; Valeant tweaks deal; Attachmate pulled; Hawaiian Telcom, Bragg set talk

By Sara Rosenberg

New York, Feb. 6 - Generac Power Systems Inc.'s credit facility freed up for trading on Monday, with the term loan B quoted above its original issue discount price, and HCA Holdings Inc. was flat to better with earnings results.

Over in the primary, Valeant Pharmaceuticals International Inc. made some changes to its oversubscribed term loan B, upsizing the tranche, trimming the spread, lowering the original issue discount and accelerating the commitment deadline.

Also, Attachmate Group removed its incremental loans from market and its concurrent amendment as a result of investor pushback.

Furthermore, Hawaiian Telcom and Bragg Communications Inc. began circulating price talk on their loans, and International Lease Finance Corp., Station Casinos LLC and Tropicana Entertainment Inc. joined this week's new issue calendar.

Generac starts trading

Generac Power Systems' credit facility hit the secondary market on Monday, with the $250 million seven-year term loan B quoted at par bid, par ½ offered, according to a trader.

Pricing on the B loan is Libor plus 275 basis points with a 1% Libor floor and an original issue discount of 991/2. There is 101 soft call protection for one year.

During syndication, the term loan B was downsized from $325 million, pricing was lowered from Libor plus 300 bps and the discount moved from 99.

The company's $725 million senior secured credit facility (Ba3/BB+) also includes a $325 million five-year term loan A, which was upsized from $250 million, and a $150 million five-year revolver. Both of these tranches priced at Libor plus 225 bps.

J.P. Morgan Securities LLC, Goldman Sachs & Co. and Bank of America Merrill Lynch are leading the deal that will be used to refinance existing bank debt and for general corporate purposes.

Generac is a Waukesha, Wis.-based designer and manufacturer of generators and other engine-powered products.

HCA steady to higher

HCA's term loans were firm following the release of fourth-quarter numbers, with some putting the debt slightly strong on the day, while others were seeing it as flat.

One trader had the term loan B-2 quoted at 98 5/8 bid, 99 1/8 offered, up from 98 3/8 bid, 98¾ offered, and the term loan B-3 quoted at 98 3/8 bid, 98 7/8 offered, up from 98 1/8 bid, 98½ offered.

However, a second trader had the loans unchanged on the day, with the B-2 quoted at 98 bid, 98½ offered and the B-3 quoted at 97 7/8 bid, 98 3/8 offered.

For the fourth quarter, HCA reported net income of $1.935 billion, or $4.25 per diluted share, versus $283 million, or $0.65 per diluted share, in the previous year.

Revenues for the quarter were 7.769 billion, up 8.5% from $7.161 billion in the 2010 fourth quarter.

And, adjusted EBITDA for the quarter was $1.639 billion, an increase of 13.2% from $1.447 billion last year.

HCA plans dividend

HCA also announced on Monday that it expects to pay a special cash dividend of $2 per share on Feb. 29 and that funds for the dividend will come from cash and borrowings under its credit facility.

As of Dec. 31, the company had cash equivalents of $373 million, total debt of $27.052 billion, and total assets of $26.898 billion.

Debt-to-adjusted EBITDA at Dec. 31 was 4.46 times, compared to 4.81 times at Dec. 31, 2010.

"We believe that a special dividend provides liquidity to our shareholders while not affecting our ability to invest in our markets or impair our acquisition strategy," R. Milton Johnson, president and chief financial officer, said in a news release.

"Also, the impact of this dividend on the company's leverage will be modest."

HCA is a Nashville-based hospital and health care services company.

Valeant reworks B loan

Switching to the primary, Valeant Pharmaceuticals changed the size and pricing on its seven-year term loan B (Ba1/BBB-) due to strong investor demand and moved the commitment deadline to noon ET on Tuesday from Thursday, according to a market source.

Under the revisions, the loan is sized at $600 million, up from $500 million, and pricing is Libor plus 275 bps with a 1% Libor floor and an original issue discount of 991/2, versus initial talk of Libor plus 300 bps with a 1% floor and a discount of 99, the source remarked. The 101 soft call protection for one year was left unchanged.

J.P. Morgan Securities LLC, Goldman Sachs & Co. and Morgan Stanley & Co. LLC are the lead banks on the deal that will be used to repay borrowings under the company's $275 million revolver and for general corporate purposes, including acquisitions.

Valeant, a Mississauga, Ont.-based specialty pharmaceutical company, expects to close on the loan this month.

Attachmate shelves deal

Attachmate terminated its plans for $400 million of add-on term loans because investors weren't pleased with the initial terms offered on the deal and the company wasn't happy with the terms lenders were seeking, according to a market source.

The source remarked that the company thought its performance merited the increased leverage and it may revisit the add-on plans in the future, but for now, the proposed deal has been cancelled completely.

The incremental loans were comprised of a $300 million first-lien term loan (B1/BB-) due April 27, 2017 talked at Libor plus 575 bps and a $100 million second-lien term loan due Oct. 27, 2017 talked at Libor plus 900 bps. Both tranches were offered with a 1.5% floor and an original issue discount of 98.

Also, call protection on the incremental debt was going to match that of the existing loans.

Attachmate cancels amendment

In connection with the add-ons, Attachmate was asking lenders to amend its existing credit facility to allow for the new debt and to use the proceeds to fund a dividend to sponsors.

Under the amendment, the company was going to reprice its existing first-lien term loan to Libor plus 575 bps from Libor plus 500 bps and its existing second-lien loan to Libor plus 900 bps from Libor plus 800 bps.

And, existing first-lien lenders were being offered a 25 bps fee for consents, while second-lien lenders were being offered a 50 bps fee.

Credit Suisse Securities (USA) LLC, RBC Capital Markets LLC, Bank of America Merrill Lynch and Wells Fargo Securities LLC were leading the transaction.

Attachmate is a Seattle-based provider of access and integration software for legacy systems.

Hawaiin Telcom floats talk

In more happenings, Hawaiian Telcom released price talk of Libor plus 575 bps with a 1.25% Libor floor and an original issue discount of 98½ on its $300 million five-year first-lien term loan as the deal is getting ready to launch with a call on Tuesday, according to a market source. There is soft call protection of 102 in year one and 101 in year two.

Credit Suisse Securities (USA) LLC is leading the deal that will be used to refinance an existing term loan due Oct. 28, 2015, resulting in net leverage of 1.96 times and total leverage of 2.53 times.

Commitments will be due on Feb. 22.

The company attempted a refinancing last year, but in July, it pulled its $300 million term loan from market as a result of unfavorable conditions. The term loan had been talked at Libor plus 550 bps with a 1.25% Libor floor and an original issue discount of 99, and included 101 soft call protection for one year.

Hawaiian Telcom is a Honolulu, Hawaii-based provider of integrated communications services.

Bragg reveals guidance

Bragg Communications disclosed price talk on its $400 million six-year term loan B in preparation for its Tuesday bank meeting in New York, according to a market source.

The loan is talked at Libor plus 325 bps with a 1% Libor floor and an original issue discount of 99, and includes 101 soft call protection for one year, the source remarked.

The company's roughly C$1.75 billion senior secured credit facility also includes a C$150 million revolver and a C$1.2 billion term loan A that launched with a bank meeting in Canada on Monday at talk of BA plus 300 bps, the source continued. The spread can range from BA plus 200 to 350 bps based on leverage and the revolver has an unused fee that is 25% of the drawn margin.

Left lead bank, TD Securities (USA) LLC, is seeking commitments by Feb. 22 on the deal that will be used to refinance existing debt and fund a dividend.

Bragg Communications is a Halifax, Nova Scotia-based cable television and telecommunications company.

International Lease readies

International Lease Finance, a Los Angeles-based independent aircraft lessor, emerged with new deal plans, setting a bank meeting for Wednesday to launch a proposed $900 million senior secured term loan that is expected to include a 1% Libor floor, according to a market source.

Commitments will be due on Feb. 15.

Bank of America Merrill Lynch, Deutsche Bank Securities Inc., UBS Securities LLC and RBC Capital Markets LLC are leading the deal that will be used to repay some revolver borrowings and other debt, as well as for general corporate purposes.

Following the news, the company's tranche-1 term loan was quoted at par bid, par ½ offered, and its tranche-2 term loan was quoted at par 1/8 bid, par 5/8 offered, both down from par ¼ bid, 101 offered on Friday, a trader remarked.

He explained that the debt was softer in trading because additional debt is being layered in, plus some guys might be worried about a future paydown as a result of the company's ability to access the capital markets.

Station Casinos coming soon

Station Casinos scheduled a bank meeting for Tuesday to launch a $1.066 billion credit facility due June 17, 2016 that has two one-year extension options subject to a 100 bps extension fee, according to a market source.

The facility is comprised of a $125 million revolver, a $195 million term loan B-1 talked at Libor plus 300 bps with step ups to Libor plus 550 bps over time and a $746 million term loan B-2 term loan talked at Libor plus 400 bps, the source said. Original issue discounts are not yet available.

Deutsche Bank Securities Inc. and J.P. Morgan Securities LLC are the lead banks on the deal that will be used to refinance existing debt.

Station Casinos is a Las Vegas-based casino company.

Tropicana plans loan

Also popping up with a new deal was Tropicana Entertainment, as it will hold a bank meeting on Wednesday to launch a proposed $175 million first-lien term loan, according to a market source.

UBS Securities LLC is the lead bank on the refinancing deal.

Total leverage is roughly 2.2 times.

Tropicana Entertainment is a Las Vegas-based owner and operator of casino gaming properties.

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