Surgical Care breaks; Alere, TriMas, Venetian Macau tweak deals; Warnaco sets pricing

By Sara Rosenberg

New York, June 15 - Surgical Care Affiliates saw its add-on term loan make its way into the secondary market late in the day on Wednesday, with levels quoted pretty much in line with the debt's original issue discount price.

Over in the primary, Alere Inc. came out with changes to its tranche sizes that resulted in an overall reduction in the credit facility amount, and official price talk was announced on the restructured deal.

Also, TriMas Corp. trimmed pricing on its term loan B and upsized its revolver, Venetian Macau Ltd. (Sands China Ltd.) reduced the spread on its revolver and term loan A, and Warnaco Group Inc. firmed pricing at the tight end of guidance.

Continuing on the topic of primary deals, INC Research LLC, Virtu Financial Inc. and Alliance HealthCare Services Inc. released price talk on their credit facilities as the transactions were presented to lenders during market hours.

Furthermore, Cumulus Media Inc. nailed down timing on the launch of its credit facility, and SBA Senior Finance II LLC, Mercury Payment Systems LLC and Kansas City Southern are also getting ready to bring new deals to market.

Surgical Care starts trading

Surgical Care's $100 million incremental term loan B (Ba3/B) due May 2018 hit the secondary market on Wednesday, with levels quoted at 99 bid, 99½ offered, according to a trader.

Pricing on the add-on is Libor plus 400 basis points with a 1.5% Libor floor, and it was sold at an original issue discount of 99. There is 101 soft call protection for one year.

Proceeds from the incremental bank debt will be used to help fund the acquisition of ambulatory surgery centers.

J.P. Morgan Securities LLC is the lead bank on the deal.

Surgical extended levels

Surgical Care also saw its newly extended term loan due December 2017 quoted at 96¾ bid, 97½ offered, while its non-extended term loan due December 2014 was quoted at 96½ bid, 97½ offered, the trader said.

Pricing on the extended loan is Libor plus 400 bps and pricing on the non-extended loan is Libor plus 200 bps. The extended tranche has 101 soft call protection for one year.

With the amend and extend, the company also asked lenders to push out the maturity on its $125 million revolver to 2016 from 2013 at pricing of Libor plus 350 bps, compared to non-extended pricing of Libor plus 175 bps.

Lenders were being offered a 25 bps amendment fee.

Surgical Care Affiliates is a Birmingham, Ala.-based operator of ambulatory surgical centers and surgical hospitals.

Alere restructures facility

Moving to the primary, Alere reworked tranching on its credit facility, which first launched with a bank meeting last week, and price talk on the transaction was released for the first time, according to a market source.

The facility now consists of a $250 million revolver, a $700 million term loan A, up from $450 million, a $300 million delayed-draw term loan A, up from $100 million, and a $750 million term loan B, down from $1 billion, the source said. A $300 million delayed-draw term loan B was removed from the capital structure.

Price talk on the A loan is Libor plus 250 bps with no Libor floor, while talk on the B loan is Libor plus 300 bps to 325 bps with a 1% Libor floor and an original issue discount of 991/2, the source continued.

Also, pricing on the term loan A and the term loan B will step up by 25 bps when senior secured leverage is greater than 3.0 times and by an additional 50 bps when senior secured leverage is greater than 4.0 times - 75 bps in total.

Alere lead banks

Jefferies & Co., GE Capital Markets, Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. are the lead banks on Alere's now $2 billion senior secured credit facility, down from $2.1 billion previously.

Proceeds will be used to refinance existing debt, to fund the buyback of common stock and to add cash to the balance sheet.

Alere is a Waltham, Mass.-based provider of near-patient diagnosis, monitoring and health management to enable individuals to improve their health and quality of life at home.

TriMas reworks deal

TriMas made some changes early on in the day to its term loan B pricing, as well as to the revolver size and spread, and asked investors to get their recommitments in by 5 p.m. ET Wednesday, according to a market source.

Specifically, the $225 million six-year term loan B saw pricing drop to Libor plus 300 bps from talk of Libor plus 325 bps to 350 bps, the source said. The 1.25% Libor floor, original issue discount of 99½ and 101 soft call protection for one year were left unchanged.

Meanwhile, the five-year revolver is being increased to up to $115 million from $75 million, and pricing is set at Libor plus 325 bps, the tight end of the Libor plus 325 bps to 350 bps talk.

TriMas repaying debt

Proceeds from TriMas' credit facility (Ba2/BB), increased from $300 million, will be used 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.

J.P. Morgan Securities LLC is the lead bank on the deal.

TriMas is a Bloomfield Hills, Mich.-based provider of engineered and applied products.

Venetian pro rata flexes

Venetian Macau cut the spread on its $500 million five-year revolver and $3 billion five-year term loan A to Libor plus 200 bps from earlier price talk of Libor plus 225 bps, according to a market source.

Goldman Sachs & Co. is the left lead bank on the revolver and A loan.

The company is also marketing a $1 billion seven-year term loan B via left lead Citigroup Global Markets Inc. that is being talked at Libor plus 275 bps with a 0.75% Libor floor and an original issue discount of 991/2.

Commitments are due on Friday.

Proceeds from the $4.5 billion credit facility (BB) will be used to refinance an existing $2.7 billion Venetian Macau credit facility and a $1.75 billion Venetian Orient Ltd. credit facility and to fund the completion of construction of the first two phases of Parcels 5&6 on the Cotai Strip.

Venetian Macau is a luxury hotel and casino resort in Macao owned by the Las Vegas Sands Corp.

Warnaco sets spread

Warnaco finalized pricing on its $200 million seven-year covenant-light term loan B (Ba1/BBB-) at Libor plus 275 bps, the low end of the Libor plus 275 bps to 300 bps talk, while leaving the 1% Libor floor, original issue discount of 99½ and 101 soft call protection for one year intact, according to a market source.

J.P. Morgan Securities LLC is the lead bank on the deal.

Proceeds will be used to refinance existing debt and for general corporate purposes.

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

INC Research talk emerges

INC Research held a bank meeting on Wednesday morning to kick off syndication on its proposed $425 million credit facility (Ba3/B+), and in connection with the event, price talk of Libor plus 475 bps to 500 bps with a 1.25% Libor floor was announced, according to a market source.

The facility is comprised of a $75 million revolver and a $350 million term loan B that is being offered at an original issue discount of 99, the source said.

Morgan Stanley & Co. Inc., ING Financial Markets LLC and RBC Capital Markets LLC are the lead banks on the deal and are asking for commitments by June 29.

Proceeds will be used to help fund the acquisition of Kendle International Inc. for $15.25 per share in cash. The total equity value is roughly $232 million.

INC Research plans notes

In addition to the credit facility, INC Research expects to issue $250 million of bonds and use equity for its purchase of Kendle.

Backing the bonds is a commitment for a $250 million senior unsecured bridge loan that is priced at Libor plus 750 bps with a 1.25% Libor floor. The spread will step up by 50 bps every four months until it hits an 11.5% cap.

Closing is expected in the third quarter, subject to approval by Kendle's shareholders as well as satisfaction of customary conditions and regulatory approvals.

INC Research is a Raleigh, N.C.-based therapeutically focused contract research organization privately held by Avista Capital Partners and Ontario Teachers' Pension Plan. Kendle is a Cincinnati-based clinical research organization.

Virtu reveals guidance

Virtu Financial also came out with price talk as it launched its $320 million term loan to investors in the afternoon, according to a market source, who said that commitments are due on June 28.

The term loan is being talked at Libor plus 500 bps with a 1.25% Libor floor and an original issue discount of 99, the source said.

Credit Suisse Securities (USA) LLC, Bank of America Merrill Lynch and Barclays Capital Inc. are the joint lead arrangers and bookrunners on the deal that will be used to help fund the company's merger with Madison Tyler Holdings LLC.

As part of the merger, Virtu will receive a strategic growth investment from Silver Lake.

Virtu is a New York-based electronic market maker and financial technology developer. Madison Tyler is a Los Angeles-based market maker and electronic trading firm.

Alliance HealthCare pricing

Alliance HealthCare Services disclosed with its Wednesday launch that it is talking its $590 million senior secured credit facility at Libor plus 400 bps to 425 bps, according to a market source.

The facility consists of a $120 million five-year revolver that has no Libor floor and a $470 million seven-year term loan B that has a 1.5% Libor floor as well as 101 soft call protection for one year and is being offered at an original issue discount of 99, the source said.

Commitments are due on June 27.

Barclays Capital Inc., Deutsche Bank Securities Inc. and SunTrust Robinson Humphrey Inc. are leading the deal that will be used by the Newport Beach, Calif.-based provider of outpatient diagnostic imaging and radiation therapy services to refinance existing bank debt.

Senior secured leverage is 2.7 times and net total leverage is 3.8 times.

Sophos comes to market

Another deal to launch on Wednesday was Sophos' roughly $460 million six-year senior secured credit facility (B+), for which price talk began circulating earlier this week.

The company's revolver and term loan A is being talked at Libor/Euribor plus 400 bps with no Libor floor and a 100 bps upfront fee, and its term loan B is being talked at Libor/Euribor plus 450 bps with a 1.5% Libor floor, an original issue discount of 99 and 101 soft call protection for one year.

The revolver is sized at $20 million revolver and the U.S. term loan B is sized at $280 million. There's also a €110 million term loan that will be divided into A and B pieces, with the breakdown still to be determined.

RBC Capital Markets LLC is the lead bank on the deal.

Net leverage is 3.6 times all senior.

Sophos funding acquisition

Proceeds from Sophos' credit facility will be used to fund the acquisition of Astaro, a provider of network security services that has headquarters in Wilmington, Mass., and Karlsruhe, Germany, and to refinance an existing credit facility.

The existing deal was obtained last summer as a $229.4 million six-year term loan B, including a $25 million euro-equivalent tranche, priced at Libor/Euribor plus 575 bps with a 2% Libor floor and sold at an original issue discount of 96, as well as a $75 million six-year euro equivalent term loan A and a $20 million six-year revolver, both priced at Libor plus 450 bps.

Sophos is an IT security and data protection firm with headquarters in Boston and Oxford, United Kingdom.

Cumulus firms timing

In more primary happenings, Cumulus Media disclosed timing on the launch of its proposed $2.415 billion senior secured credit facility (Ba3), as a bank meeting has been set for Monday at 2 p.m. ET in New York, according to a market source.

The facility consists of a $375 million five-year revolver and a $2.04 billion seven-year covenant-light term loan B.

As was previously reported, the deal was initially expected to have a total size of $2.525 billion. However, the company's bond offering, which was completed last month, came larger than expected at $610 million, as opposed to at $500 million. Proceeds from the bonds were used to repay the company's existing term loan.

J.P. Morgan Securities LLC, UBS Securities LLC and Macquarie Capital are the lead banks on the deal.

Cumulus buying Citadel

Proceeds from Cumulus' credit facility, along with $500 million of equity from Crestview Partners and Macquarie Capital, will be used to fund the acquisition of Citadel Broadcasting Corp. in a transaction valued at $2.4 billion and to refinance outstanding debt.

Cumulus is buying Citadel for $37 per share, with stockholders having the option to receive the per-share payment in cash or get 8.525 shares of Cumulus common stock, subject to proration. The total amount of cash available in the transaction is $1.4 billion, and the total number of common stock shares available is about 151 million.

Closing is expected by the end of this year, subject to customary conditions, including Citadel stockholder approval, expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and regulatory approval from the Federal Communications Commission.

Cumulus is an Atlanta-based radio broadcaster. Citadel is a Las Vegas-based radio company.

SBA launching B loan

SBA Senior Finance has set a bank meeting for Thursday with a 2 p.m. ET start time at the Barclay Intercontinental in New York to launch a proposed $500 million seven-year term loan B that is being led by J.P. Morgan Securities LLC and Barclays Capital Inc., according to a market source.

In addition to the term loan B, the company is getting a $500 million five-year revolver.

Proceeds from the $1 billion senior secured credit facility (Ba2/BB) will be used to refinance and repay borrowings under an existing $500 million revolver and for general corporate purposes.

SBA Senior Finance is a wholly owned subsidiary of SBA Communications Corp., a Boca Raton, Fla.-based owner and operator of wireless communications infrastructure.

Mercury readies deal

Mercury Payment Systems will be holding a bank meeting at 2:30 p.m. ET on Thursday to launch a proposed $200 million six-year term loan B that will include 101 soft call protection for one year, according to a market source, who said that price talk should come out at launch.

Deutsche Bank Securities Inc. is the lead bank on the deal that will be used to fund a distribution to shareholders.

Pro forma gross leverage is 3.9 times and net leverage is 3.39 times.

Mercury Payment Systems is Durango, Colo.-based payment processing company that partners with point-of-sale developers and resellers.

Kansas City coming soon

Kansas City Southern is scheduled to hold a bank meeting on Thursday to launch a proposed $500 million five-year credit facility that is being talked at Libor plus 175 bps, according to a market source.

The facility consists of a $200 million revolver and a $300 million term loan A, the source said.

Bank of America Merrill Lynch and Scotia Capital (USA) Inc. are the lead banks on the deal that will be used to refinance existing debt.

Kansas City Southern is a Kansas City, Mo.-based transportation holding company that has railroad investments in the U.S., Mexico and Panama.

Lumen wraps facility

In other news, Lumen completed its $113.3 million senior secured facility in line with initial talk of Libor plus 500 bps with a 1.5% floor and a discount price of 981/2, according to a market source.

The facility consists of a $10 million revolver and a $103.3 million term loan.

Bank of Ireland and Madison Capital led the deal that was used to merge the financing of Watchfire and SloanLED, both owned by Harbour Group, and to fund a dividend payment. The two companies continue to operate as separate entities.

Other funds for the transaction came from $36.9 million of mezzanine debt from Golub Capital.

Leverage through the credit facility is 3.5 times and total leverage is 4.75 times.

Watchfire is a Danville, Ill.-based provider of branded LED displays, billboards and related software and services. SloanLED is a Ventura, Calif.-based provider of specialty LED lighting systems for use in sign, spa and optoelectronic applications.

FTD completes refi

FTD Group Inc., a Downers Grove, Ill.-based floral company, closed on its $315 million credit facility that was used to refinance existing debt, according to a news release.

The facility consists of a $265 million seven-year term loan priced at Libor plus 350 bps with a 1.25% Libor floor that was sold at an original issue discount of 99½ and a $50 million five-year revolve priced at Libor plus 350 bps.

During syndication, pricing on the term loan firmed at the wide end of the Libor plus 325 bps to 350 bps talk.

Wells Fargo Securities LLC acted as the lead bank on the deal.

Gibson closes

Gibson Energy ULC, a Calgary, Alberta-based midstream energy company, crude oil transporter and retail propane distributor, completed its $925 million senior secured credit facility (B1), consisting of a $275 million five-year revolver and a $650 million seven-year term loan, according to a 6-K filed with the Securities and Exchange Commission.

Pricing on the term loan is Libor plus 450 bps with a 1.25% Libor floor, and it was sold at an original issue discount of 99. There is 101 soft call protection for two years.

During syndication, the term loan was downsized from $700 million, pricing flexed from talk of Libor plus 350 bps to 375 bps, and soft call protection was extended from one year. Also, the revolver was upsized from $250 million.

J.P. Morgan Securities LLC, Citigroup Global Markets Inc. and UBS Securities LLC led the deal that was used to help refinance debt and for general corporate purposes.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.