Wendy's/Arby's prices $500 million; Regal Cinemas trades higher; Sedgwick sets pricing

By Paul A. Harris

St. Louis, May 19 - Bank loans were softer on Wednesday, market sources said.

The Barclays bank loan index has given up 1.33% since the beginning of May, according to a loan portfolio manager for a mutual fund.

May appears headed toward being the first down month in the bank loan market since November 2009, which was itself the first down month since December 2008, the source added.

May's decline notwithstanding, the index has returned 4.42%, year to date.

"Fast money, which pushed pricing on lower-rated loans, appears to have backed off, somewhat," the manager commented.

TXU Corp.'s term loan was at 76½ bid, heading into Wednesday afternoon, down from 80½ bid at the beginning of the month.

First Data Corp.'s term loan was at 84¼ bid, down from 90 bid on May 3.

"Although the bank loan market has reacted negatively to the financial news out of Europe, recent secondary market activity feels more like a correction than a panic," to this investor.

"There is not a lot of selling of quality loans," the fund manager said.

Wendy's/Arby's prices

Wendy's/Arby's Group, Inc. priced its $500 million term loan (Ba2/BB) at Libor plus 350 bps with an original issue discount of 99.50, market sources said Thursday.

The coupon printed at the wide end of the Libor plus 325 to 350 bps spread talk.

The price came top of price talk which was boosted from earlier talk of 99.

The deal features a 1.5% Libor floor and a one-year soft call at 101.

Bank of America Merrill Lynch and Citigroup led the deal.

Proceeds will be used to refinance existing loans, to redeem Wendy's International's $200 million 6¼% senior notes due 2011 and for general corporate purposes.

The loan was two times oversubscribed, according to a market source, who spotted it trading at 99 7/8 bid, par ¼ offered during the early afternoon, versus the 99.50 issue price.

Regal Cinemas trades higher

The recently priced Regal Cinemas $1.25 billion Libor plus 350 bps term loan was also seen trading higher, on Wednesday morning.

The deal, which priced at 99.00, was trading at 99½ bid, par offered

The $1.335 billion amended and restated senior credit facility (Ba3/BB-) also includes an $85 million five-year revolver.

Credit Suisse, Barclays, Bank of America and Deutsche Bank are the lead banks on the deal, with Credit Suisse the left lead.

Sedgwick pricing firms

Pricing emerged Wednesday on Sedgwick Claims Management Services, Inc.'s $660 million credit facility, according to market sources.

The $400 million six-year first-lien loan (B1/B+) comes at a spread of Libor plus 400 bps, at the wide end of the Libor plus 375 to 400 bps spread talk.

The 1.5% Libor floor and 99.00 reoffer price firmed in line with price talk.

The $200 million seven-year second-lien loan comes at a spread of Libor plus 750 bps, on top of spread talk.

The second-lien loan's 1.5% Libor floor and 98.50 reoffer price both were finalized in line with talk.

The deal also includes a $60 million five-year revolver, which is talked at Libor plus 375 to 400 bps.

The loans could allocate by the end of the present week.

Bank of America Merrill Lynch and Barclays Capital are the lead banks on the $660 million credit facility.

Proceeds will be used to help fund the buyout of the company by Stone Point Capital LLC and Hellman & Friedman LLC for $1.1 billion, including repayment of debt, from its current group of investors, which includes Fidelity National Financial Inc., Thomas H. Lee Partners LP, Evercore Capital Partners and other minority shareholders.

The transaction is expected to close during the second quarter, subject to usual and customary conditions and the receipt of regulatory approvals.

Sedgwick is a Memphis, Tenn.-based provider of claims and productivity management services to corporate and institutional clients.

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