Chrysler reworked again, breaks; Revlon, Valitas, BakerCorp free up; Asurion tweaks deal

By Sara Rosenberg

New York, May 19 - Chrysler Group LLC revised the size on its term loan once more, this time increasing it from its most recent amount, and the Libor floor firmed at the tight end of modified talk. And once final terms were established, the loan made its way into the secondary market.

Also breaking for trading on Thursday was Revlon Consumer Products Corp., Valitas Health Services Inc. and BakerCorp, with all of the companies' term loans quoted above their original issue discount prices.

Back over in the primary market, Asurion LLC upsized its second-lien term loan and set pricing at the tight end of talk, while its first-lien term loan was downsized with the original issue discount finalizing at the wide end of guidance.

Chrysler tweaks deal

Chrysler made some new changes to its six-year term loan B, increasing the size to $3 billion from $2.5 billion and firming the Libor floor at 1.25%, the low end of recent talk of 1.25% to 1.5%, according to a market source.

Pricing on the loan is Libor plus 475 bps and it was offered at an original issue discount of 99. It is non-callable for one year, then at 102 in year two and 101 in year three.

Recommitments were due from lenders by 11 a.m. ET on Thursday.

Earlier this week, the term B was downsized to $2.5 billion from $3.5 billion, pricing widened from talk of Libor plus 400 bps to 425 bps, the Libor floor was being offered in the 1.25% to 1.5% range instead of at just 1.25%, the original issue discount moved to 99 from talk of 99 to 991/2, and call protection was sweetened from just 101 soft call for one year.

Chrysler trims revolver

In addition to the term loan size change, Chrysler reduced its five-year revolver to $1.3 billion from $1.5 billion, a second source remarked.

Proceeds from the credit facility, notes and $1.3 billion of proceeds from an investment by Fiat will be used to help repay all of the company's loans provided by the U.S. Department of the Treasury and the Canadian federal and Ontario governments.

The company's bond offering is sized at $3.2 billion, down from a most recent amount of $3.5 billion, but up from initial talk of $2.5 billion.

Chrysler frees up

After terms on Chrysler's deal were finalized, allocations went out and the debt moved into the secondary market, with the term loan B quoted at par ¼ bid, par ½ offered, according to a trader.

Morgan Stanley & Co. Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. and Bank of America Merrill Lynch are the lead banks on the $4.3 billion senior secured deal (Ba2), with Morgan Stanley the left lead on the term loan and Citi the left lead on the revolver.

Chrysler is an Auburn Hills, Mich.-based producer of Chrysler, Jeep, Dodge, Ram, Mopar and Fiat vehicles and products.

Revlon tops par

Revlon's $800 million 61/2-year term loan (Ba3) also began trading on Thursday, with levels quoted at par ¼ bid, par ¾ offered on the open and into the afternoon, according to a trader.

Pricing on the term loan is Libor plus 350 bps with a 1.25% Libor floor that was reduced from 1.5% last week, and it was sold at an original issue discount of 991/2. There is 101 soft call protection for one year.

Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC, Wells Fargo Securities LLC and Natixis acted as the lead banks on the deal.

Financial covenants include a first-lien senior secured leverage ratio of no more than 4.0 to 1.0 for each period of four consecutive fiscal quarters ending during the period from June 30, 2011 to maturity.

Revlon replacing loan

Proceeds from Revlon's term loan, which closed and funded on Thursday, were used to refinance a $792 million term loan due March 2015 that was obtained in 2010.

Pricing on the prior term loan was Libor plus 400 bps with a 2% Libor floor, and it was sold at an original issue discount of 981/4.

Total first-lien secured debt to latest 12 months adjusted EBITDA as of March 31 is 2.9 times, and total debt to LTM March 31 adjusted EBITDA is 4.6 times.

Revlon is a New York-based cosmetics, hair color, beauty tools, fragrances, skincare, anti-perspirant/deodorant and beauty care products company.

Valitas hits secondary

Another deal to break during the session was Valitas Health Services' credit facility, with the $285 million six-year term loan quoted at par ¼ bid, par ¾ offered, according to a market source.

Pricing on the term loan is Libor plus 450 bps with a step-down to Libor plus 425 bps at 3.75 times leverage. There is a 1.25% Libor floor as well as 101 soft call protection for one year, and the debt was sold at an original issue discount of 991/2.

The company's $360 million senior secured credit facility (Ba3/B) also includes a $75 million five-year revolver priced at Libor plus 450 bps with a 1.25% Libor floor.

During syndication, the Libor floor on the entire facility was lowered from 1.5%. Also, regarding the term loan, the discount tightened from 99 and the call protection and pricing step-down were added.

Valitas funding acquisition

Proceeds from Valitas' credit facility, along with $100 million of mezzanine debt that has been committed by GSO Capital Partners LP, will be used to help finance the purchase of America Service Group Inc. for $26.00 per share in cash, or about $250 million.

Barclays Capital Inc. and Bank of America Merrill Lynch are the lead banks on the credit facility.

Closing on the transaction is expected in the second quarter, subject to the approval of America Service Group's stockholders and other customary conditions, including the satisfaction of governmental and regulatory approval requirements.

St. Louis-based Valitas and Brentwood, Tenn.-based America Service Group are providers of health care services to the incarcerated population. The corporate headquarters for the combined company will be in Brentwood, Tenn.

BakerCorp trades atop OID

BakerCorp's $390 million seven-year covenant-light term loan B was also seen quoted at par ¼ bid, par ¾ offered as it too freed up for trading during the session, according to a trader,

Pricing on the B loan is Libor plus 375 bps with a step-down that was added during syndication to Libor plus 350 bps when net senior secured leverage is 2.75 times. 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's $435 million credit facility (Ba3/B) also includes a $45 million revolver.

Deutsche Bank Securities Inc. and Morgan Stanley & Co. Inc. are the lead banks on the deal that will be used to help fund the buyout of the company by Permira funds for $960 million.

The acquisition is expected to close by July, subject to customary regulatory approvals.

BakerCorp is a Seal Beach, Calif.-based provider of equipment rental services for liquid and solid containment applications.

Asurion retranches

Switching back to the primary market, Asurion reworked its tranche sizes on Thursday as well, increasing its eight-year second-lien term loan to $1.27 billion from $990 million and decreasing its seven-year first-lien term loan B to $2.2 billion from $2.48 billion, according to a market source.

Second-lien term loan pricing firmed at Libor plus 750 bps with a 1.5% Libor floor and an original issue discount of 991/2, compared to initial talk of Libor plus 750 bps to 775 bps with a 1.5% Libor floor and a discount of 99 to 991/2, the source remarked. The tranche is still non-callable for one year, then at 103 in year two and 101 in year three

Meanwhile, pricing on the first-lien term loan firmed in line with talk at Libor plus 400 bps with a 1.5% Libor floor, and the original issue discount came at 99, the wide end of the 99 to 99½ talk, the source continued. There continues to be 101 soft call protection.

The company's $3.57 billion covenant-light deal also includes a $100 million five-year revolver.

Asurion shuts books

After receiving the revisions to Asurion's credit facility, lenders were asked to get their recommitments in by 5 p.m. ET on Thursday, with the plan being that allocations will go out on Friday afternoon and closing will take place on Tuesday.

Bank of America Merrill Lynch, Barclays Capital Inc., Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. Inc., Goldman Sachs & Co. and Deutsche Bank Securities Inc. are the lead banks on the deal.

Net first-lien leverage is 2.9 times and net total leverage is 4.8 times.

Asurion refinancing debt

Asurion, a Nashville-based provider of technology protection services, will use proceeds from its credit facility to refinance existing bank debt and repay a parent note.

The company had attempted a larger-scale refinancing earlier this year - comprised of a $120 million five-year revolver, a $3.5 billion seven-year first-lien term loan and a $1.02 billion eight-year second-lien term loan - but it was pulled in March due to market conditions.

Talk on withdrawn first-lien term loan had been Libor plus 375 bps to 400 bps with a 1.5% Libor floor, an original issue discount of 99 to 99½ and 101 soft call protection for one year, and talk on the second-lien loan had been Libor plus 775 bps with a 1.5% Libor floor, an original issue discount of 99 to 99½ and it was non-callable for one year, then at 103 in year two and 101 in year three.

Walter launches

In other news, Walter Investment Management Corp. held a bank meeting on Thursday afternoon, launching its proposed $810 million senior secured credit facility at previously outlined price talk, according to an 8-K filed with the Securities and Exchange Commission.

The $45 million five-year revolver and $500 million five-year first-lien term loan are talked at Libor plus 525 bps, and the $265 million 51/2-year second-lien term loan is talked at Libor plus 900 bps, with all tranches having a 1.5% Libor floor and an offer price of 99. The revolver has a 75 bps unused fee.

Also, the first-lien term loan has 101 soft call protection for one year, and the second-lien term loan has call protection of 103 in year one, 102 in year two and 101 in year three.

Most terms are consistent with what was outlined in the debt commitment letter back in March. What's different is that letter had put the discount price on the second-lien loan at 98 and second-lien call protection as non-callable for one year, then at 103 in year two, 102 in year three and 101 in year four.

Walter lead banks

Credit Suisse Securities (USA) LLC and RBS Securities Inc. are the joint bookrunners and lead arrangers on Walter Investment's credit facility, with Credit Suisse the administrative agent. Bank of America Merrill Lynch is a bookrunner and a co-documentation agent, and Morgan Stanley Senior Funding Inc. is a co-documentation agent.

Initially, the deal was expected to be sized at $795 million, but it was recently increased through the upsizing of the revolver from $30 million.

Financial covenants include total debt to EBITDA and EBITDA to interest expense.

Amortization on the first-lien term loan is 2.5% Per quarter with the remainder due at maturity. There is no amortization on the second-lien loan.

Commitments are due on June 6, and closing and funding is expected to take place in early July.

Walter buying Green Tree

Proceeds from Walter Investment's credit facility will be used to help 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.

Other funds for the acquisition will come from cash on hand and the issuance of 1.8 million shares of common stock to the seller.

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

Closing on the transaction is 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 specializing in less-than-prime, non-conforming and other credit-challenged assets.

Drake comes to market

Also launching with a bank meeting on Thursday was Drake Beam Morin's $115 million credit facility that is being led by SunTrust Robinson Humphrey Inc., according to a market source.

The facility consists of a $10 million five-year revolver and a $105 million six-year term loan, with both tranches talked at Libor plus 500 bps. The term loan has a 1.5% Libor floor and an original issue discount of 99.

Proceeds from the non-rated transaction will be used to refinance existing debt, to fund a dividend to shareholders and for general corporate purposes.

Drake Beam Morin is a New York-based provider of strategic human resources services, focusing on outplacement and transition services.

Medpace deal plans emerge

Medpace Inc. has set a bank meeting for Tuesday to launch a proposed $335 million credit facility that consists of a $50 million revolver and a $285 million term loan, according to a market source.

Jefferies & Co., Barclays Capital Inc., Bank of America Merrill Lynch and SunTrust Robinson Humphrey Inc. are the lead banks on the deal.

Senior leverage will be 4.5 times.

Proceeds will be used to help fund the buyout of the Cincinnati-based research-based drug development company by CCMP Capital Advisors LLC from management.

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