XPO, Polyconcept, Continental Building, Headwaters, WaveDivision free to trade; Valeant dips

By Sara Rosenberg

New York, Aug. 11 – XPO Logistics Inc. came to market with a new term loan B-2 in the morning and then broke the debt for trading by late Thursday, and deals from Polyconcept, Continental Building Products Operating Co. LLC, Headwaters Inc. and WaveDivision Holdings LLC hit the secondary market too.

In more trading happenings, Valeant Pharmaceuticals International Inc.’s term loans headed lower following reports that the company may be under investigation for fraud regarding its relationship with Philidor.

Back in the primary market, Diamond Resorts International Inc. reduced the size of is term loan B and widened the spread and issue price, and CAMP International Holding Co. trimmed pricing on its first- and second-lien term loans and tightened original issue discounts.

Also, Hilton Worldwide Finance LLC firmed pricing on its term loan B-2 at the low end of guidance, Albaugh Inc. revised the issue price on its add-on term loan, and Innovation Ventures LLC pulled its credit facility from market.

In addition, EP Energy LLC launched a new term loan for an exchange of existing term debt, Epicor Software Corp. approached lenders with an incremental first-lien term loan, and GCP Applied Technologies Inc. joined the calendar with a repricing transaction.

XPO launches, breaks

XPO Logistics surfaced in the morning with plans to hold a lender call at 10:15 a.m. ET on Thursday to launch a non-fungible $400 million first-lien term loan B-2 (BB-) due Oct. 30, 2021 talked at Libor plus 325 basis points with a 1% Libor floor, an original issue discount of 99 to 99.5 and 101 soft call protection for six months, according to a market source.

Commitments were due by 4 p.m. ET, and, by late day, the discount on the loan firmed at 99.5, the source said.

Then, in the evening, the term loan B-2 freed up for trading at par bid, 100½ offered, a trader added.

Morgan Stanley Senior Funding Inc. is leading the deal that will be used with $535 million of senior notes and cash on hand to repurchase the company’s existing 7.875% senior notes due 2019.

XPO Logistics is a Greenwich, Conn.-based provider of supply chain solutions.

Polyconcept starts trading

Polyconcept’s credit facility also emerged in the secondary market, with the $435 million seven-year senior secured first-lien term loan B (B1/B) quoted at 99½ bid, 100½ offered, according to a trader.

Pricing on the term loan is Libor plus 525 bps with a 1% Libor floor, and it was sold at an original issue discount of 99. The debt has 101 soft call protection for one year, which was extended from six months during syndication.

The company’s $523 million credit facility also includes an $88 million ABL revolver (BB-).

Goldman Sachs & Co., RBC Capital Markets and Natixis are leading the deal that will be used with a privately placed second-lien term loan to help fund the buyout of the company by Charlesbank Capital Partners from Investcorp.

Polyconcept is a supplier of promotional products.

Continental Building tops OID

Continental Building Products’ credit facility broke for trading too, with the $275 million seven-year covenant-light first-lien term loan quoted at 99 7/8 bid, 100 3/8 offered, according to a trader.

Pricing on the term loan is Libor plus 275 bps with a 0.75% Libor floor, and it was sold at an original issue discount of 99.75. The debt has 101 soft call protection for six months.

The company’s $350 million credit facility (BB+) also includes a $75 million revolver.

Credit Suisse Securities (USA) LLC is the left lead bank on the deal that will be used to refinance an existing first-lien credit facility.

Continental Building is a Herndon, Va.-based manufacturer of wallboard and gypsum-based products.

Headwaters hits secondary

Headwaters’ $350 million covenant-light add-on term loan B (B1/BB-) due March 24, 2022 freed up as well, with levels seen at par bid, 100 3/8 offered, a trader said.

The add-on term loan is priced at Libor plus 300 bps with a 1% Libor floor, in line with existing term loan pricing, and was sold at an original issue discount of 99.75, following a revision on Tuesday from 99.5. The debt includes 101 soft call protection for six months.

Deutsche Bank Securities Inc. and Bank of America Merrill Lynch are leading the deal that will be used to fund the acquisition of Krestmark Industries LP for $240 million and to refinance 7.25% senior notes due 2019.

Closing is expected on Aug. 19.

Headwaters is a South Jordan, Utah-based building products manufacturer. Krestmark is a Dallas-based manufacturer of vinyl windows.

WaveDivision frees up

WaveDivision’s fungible $125 million add-on first-lien term loan (Ba3) also began trading, with levels quoted at 100¼ bid, 100 5/8 offered, a trader remarked.

Pricing on the add-on term loan is Libor plus 300 bps with a 1% Libor floor, and it was sold at an original issue discount of 99.875, after tightening on Wednesday from talk of 99.5 to 99.75. The first-lien term loan debt is getting 101 soft call protection for six months.

Jefferies Finance LLC is leading the deal that will be used for general corporate purposes.

WaveDivision is a Kirkland, Wash.-based owner and operator of broadband cable systems.

Valeant softens

Also in trading, Valeant Pharmaceuticals’ term loans weakened with chatter that the company is possibly facing fraud charges regarding its ties to Philidor, an online pharmacy, according to traders.

The term loan F was quoted by one trader at 99 7/8 bid, 100 3/8 offered, down from 100 1/8 bid, 100 5/8 offered, and the term loans C and D were quoted at 99 7/8 bid, 100 3/8 offered, down from par bid, 100½ offered.

A second trader had the term loan F at par bid, 100½ offered, down from 100 1/8 bid, 100 5/8 offered, and the term loans C and D were at 99 7/8 bid, 100¼ offered, down from par bid, 100½ offered.

In response to the rumors, the company released a statement saying, “Valeant previously disclosed in October 2015 that the United States Attorney’s Office for the Southern District of New York commenced an investigation involving Valeant. We have been fully cooperating with the authorities throughout the investigation, and we are in frequent contact and continue to cooperate with the U.S. Attorney’s Office for the Southern District of New York. We do not comment on rumors about investigations, and cannot comment on or speculate about the possible course of any ongoing investigation.”

Valeant is a Laval, Quebec-based specialty pharmaceutical company.

Diamond reworks loan

Switching back to the primary market, Diamond Resorts reduced its seven-year covenant-light term loan B to $800 million from $1.2 billion, raised pricing to Libor plus 600 bps from Libor plus 500 bps and moved the original issue discount to 98 from 99, according to a market source.

The term loan still has a 1% Libor floor and 101 soft call protection for six months.

With the term loan B downsizing, the company added a $400 million senior secured notes offering to its transaction to join a previously announced $600 million senior unsecured notes offering.

The company’s now $900 million senior secured credit facility also includes a $100 million five-year revolver.

Diamong being acquired

Proceeds from Diamond Resorts’ credit facility, bonds and about $1.06 billion of equity will be used to fund its buyout by Apollo Global Management LLC for $30.25 per share or about $2.2 billion.

Barclays, RBC Capital Markets LLC, Jefferies Finance LLC and Natixis are leading the credit facility.

Completion of the loan transaction is expected occur early next week, the source added.

Closing is subject to more than 50% of the company’s common shares being tendered, the receipt of certain regulatory approvals and other customary conditions.

Diamond Resorts is a Las Vegas-based hospitality and vacation ownership company.

CAMP changes surface

CAMP International lowered pricing on its $529 million seven-year first-lien term loan (B2/B-) to Libor plus 375 bps from Libor plus 425 bps and modified the original issue discount to 99.5 from 99, while keeping the 1% Libor floor and 101 soft call protection for six months intact, a market source said.

In addition, pricing on the company’s $188 million eight-year second-lien term loan (Caa2/CCC) was cut to Libor plus 725 bps from Libor plus 850 bps and the discount was revised to 99.5 from 98, the source continued. This tranche still has a 1% Libor floor and call protection of 102 in year one and 101 in year two.

Recommitments for the company’s $757 million senior secured credit facility, which also includes a $40 million five-year revolver (B2/B-), were due at noon ET on Thursday, the source added.

UBS Investment Bank is leading the deal that will be used to refinance an existing holdco facility.

CAMP is a Merrimack, N.H.-based provider of aircraft maintenance tracking software and information services to business aviation.

Hilton sets spread

Hilton Worldwide firmed pricing on its $3,225,000,000 covenant-light term loan B-2 (Ba1/BBB) due October 2023 at Libor plus 250 bps, the tight end of the Libor plus 250 bps to 275 bps, according to a market source.

As before, the term loan has no Libor floor, a 25-bps extension fee/original issue discount and 101 soft call protection for six months.

Deutsche Bank Securities Inc., Bank of America Merrill Lynch, Goldman Sachs Bank USA, Morgan Stanley Senior Funding Inc., J.P. Morgan Securities LLC and Wells Fargo Securities LLC are leading the deal that will be used to amend and extend by three years a portion of the company’s existing $4,225,000,000 term loan B.

Hilton is a McLean, Va.-based hospitality company.

Albaugh tweaks OID

Albaugh modified the original issue discount on its fungible $75 million add-on term loan (B1/BB-) to 99.75 from 99.5, a source remarked.

As before, pricing on the add-on term loan is Libor plus 500 bps with a 1% Libor floor, which matches existing term loan pricing.

HSBC Securities (USA) Inc. is leading the deal that will be used for general corporate purposes.

Allocations went out on Thursday, the source added.

Albaugh is an Ankeny, Iowa-based producer of generic crop protection products.

Innovation shelves deal

Innovation Ventures withdrew its $525 million senior secured credit facility (B1/BB) from market that was going to be used to help fund the purchase of a majority interest in it by Renew Group Private Ltd. and to repurchase 9½% senior secured notes due 2019, according to a news release.

The release went on to say that Innovation Ventures is no longer pursuing the credit facility, a proposed unsecured notes offering, the sale to Renew Group or the notes buyback because it was decided that the transactions were not in the best interest of the company and its equityholders at this time.

The pulled credit facility that had launched with a bank meeting on Aug. 4 consisted of a $25 million revolver due in 2020 and a $500 million five-year term loan talked at Libor plus 450 bps with a 1% Libor floor and an original issue discount of 99.

Bank of America Merrill Lynch and KeyBanc Capital Markets LLC were leading the deal.

Farmington Hills, Mich.-based Innovation Ventures is the producer of 5-hour Energy, a liquid energy shot.

EP comes to market

In more primary happenings, EP Energy held a lender call at noon ET to launch a new covenant-light term loan (B3/B+) due June 30, 2021 that is talked at Libor plus 875 bps with a 1% Libor floor, a 300-bps extension fee and hard call protection of 103 in year one and 101 in year two, sources said.

Citigroup Global Markets Inc. is leading the new loan that will be granted in exchange for existing term loan B-2 debt due April 2019 priced at Libor plus 350 bps with a 1% Libor floor and term loan B-3 debt due May 2018 priced at Libor plus 275 bps with a 0.75% Libor floor.

As of June 30, there was $142 million outstanding under the term loan B-2 and $469 million outstanding under the term loan B-3, according to an 8-K filed with the Securities and Exchange Commission.

With the exchange, an amendment is being sought to the existing term loan to remove covenants restricting the incurrence of debt and issuance of disqualified and preferred stock, and the incurrence and existence of liens.

Lenders that do not consent to the exchange will retain their respective B-2 term loans and B-3 term loans.

Consents are due on Aug. 18 and closing is targeted for Aug. 23.

EP Energy is a Houston-based oil and natural gas exploration and production company.

Epicor launches loan

Epicor Software held a lender call, launching a $225 million incremental first-lien term loan (B2) with talk of Libor plus 400 bps with a 1% Libor floor, an original issue discount of 98 to 98.5 and 101 soft call protection for six months, according to a market source.

Commitments are due at noon ET on Tuesday, the source said.

KKR Capital Markets is leading the deal.

The company is also getting a $75 million second-lien term loan (Caa2) that has been pre-placed.

Proceeds will be used to help back the buyout of the company by KKR from Apax Partners, which is expected to close by the end of this month, subject to customary conditions, including regulatory approval.

The company’s existing credit agreement has pre-cap language that allows the debt to remain in place following the change of control.

Epicor is an Austin, Texas-based provider of enterprise business software services.

GCP readies deal

GCP Applied Technologies set a lender call for 9:30 a.m. ET on Friday to launch a repricing of its $274 million term loan due February 2022 that is talked at Libor plus 325 bps with a 0.75% Libor floor, a par issue price and 101 soft call protection for six months, a market source remarked.

By comparison, current pricing on the term loan is Libor plus 450 bps with a 0.75% Libor floor.

Commitments are due at noon ET on Aug. 18, the source added.

Deutsche Bank Securities Inc. is leading the deal.

GCP is a Cambridge, Mass.-based provider of products and technology solutions in the specialty construction chemicals, specialty building materials and packaging sealants and coating industries.

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