Novolex, Sonneborn, Total Merchant changes emerge; primary sees more than 10 deals launch

By Sara Rosenberg

New York, Dec. 2 – The primary market on Tuesday saw a couple of deals undergo revisions, with Novolex revising its first- and second-lien term loan sizes and spreads, widening the original issue discount on its second-lien tranche and sweetening the call protection on its first-lien tranche, Sonneborn LLC tightening the offer price on its term loan, and Total Merchant Services Inc. raising pricing on its term loan and shortening the maturity.

Also in the primary, Dealer Tire LLC, Vine Oil & Gas LP, Proserv Group Inc., Accuvant, Impax Laboratories Inc., CPM Holdings Inc., Siemens Audiology Systems (Auris Luxembourg III Sarl), Chief Power Finance LLC, New Media Investment Group Inc., CRGT Inc. and Bright Horizons Family Solutions Inc. disclosed price talk on their new deals, and Amneal Pharmaceuticals LLC and Emdeon Inc. emerged with loan plans.

Novolex modified

Novolex on Tuesday raised its seven-year first-lien term loan to $880 million from $840 million, widened pricing to Libor plus 500 basis points from Libor plus 450 bps and extended the 101 soft call protection to one year from six months, according to a market source.

Also, the company’s 7½-year second-lien term loan was trimmed to $230 million from $275 million, the spread was changed to Libor plus 875 bps from talk of Libor plus 825 bps to 850 bps and the discount was modified to 97½ from 99, the source said.

Other changes to both term loans included eliminating the MFN sunset provision and reducing the incremental facility fixed dollar amount shared between the tranches to $100 million and, regarding the first-lien term loan, the incremental incurrence test was set at 3.5 times first-lien leverage.

As before, both term loans have a 1% Libor floor, the first-lien term loan has an original issue discount of 99, and the second-lien term loan has hard call protection of 102 in year one and 101 in year two.

Novolex getting revolver

In addition to the term loans, Novolex’s now $1,235,000,000 credit facility includes a $125 million revolver priced at Libor plus 500 bps with no Libor floor and an original issue discount of 99½.

Recommitments are due at noon ET on Wednesday, allocations are expected on Thursday and closing is targeted for Friday, the source added.

GE Capital Markets, Deutsche Bank Securities Inc., BMO Capital Markets Corp. and Macquarie Capital (USA) Inc. are leading the deal, with GE left lead on the first-lien and Deutsche left lead on the second-lien.

Proceeds will be used to fund the acquisition of Packaging Dynamics and repay existing first-lien term loan and mezzanine debt.

First-lien leverage is 4.2 times and total leverage is 5.27 times.

Novolex, formerly Hilex Poly, is a Hartsville, S.C.-based manufacturer of plastic bags and film products.

Sonneborn revises OID

Sonneborn changed the original issue discount on its $280 million six-year first-lien term loan (B1/B) to 99¾ from 99½, and kept pricing at Libor plus 450 bps with a 1% Libor floor, according to a market source.

The loan still has 101 soft call protection for six months.

Recommitments are due at 2 p.m. ET on Wednesday, the source said.

Macquarie Capital (USA) Inc. is leading the deal that will be used to refinance existing debt and fund a distribution to the sponsor, One Equity Partners.

Sonneborn is a Parsippany, N.J.-based manufacturer and supplier of high-purity specialty hydrocarbons.

Total Merchant tweaks deal

Total Merchant Services lifted the spread on its $160 million first-lien term loan to Libor plus 550 bps from Libor plus 500 bps, cut the maturity to six years from seven years and added a leverage test of 2.5 times for restricted payments, a market source said.

As before, the term loan has a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year.

The company’s $175 million credit facility (B2/B+) also includes a $15 million revolver.

Recommitments are due at 5 p.m. ET on Wednesday, the source continued.

Credit Suisse Securities (USA) LLC is leading the deal that will be used to refinance existing debt and fund a dividend.

Total Merchant Services is a merchant acquirer for payment processing.

Dealer Tire guidance

In more new deal happenings, Dealer Tire had its bank meeting on Tuesday, and its $615 million seven-year term loan B was launched with talk of Libor plus 450 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, a market source said.

The company’s $715 million credit facility also includes a $100 million five-year revolver.

J.P. Morgan Securities LLC is leading the deal that will be used to help fund the buyout of the company by Lindsay Goldberg LLC from TA Associates.

Closing is expected this month.

Dealer Tire is a Cleveland-based distributor of replacement tires and parts for automotive OEMs and their dealers.

Vine Oil holds meeting

Vine Oil & Gas released price talk on its $850 million of term loans in connection with its late-morning bank meeting, according to a market source.

The $500 million seven-year first-priority term loan B (B3) is talked at Libor plus 675 bps to 700 bps with a 1% Libor floor, an original issue discount of 98 and call protection of 102 in year one and 101 in year two, and the $350 million 7½-year second-priority term loan C (Caa2) is talked at Libor plus 875 bps to 900 bps with a 1% Libor floor, a discount of 90, and call protection of 103 in year one, 102 in year two and 101 in year three, the source said.

Commitments are due on Dec. 15.

Morgan Stanley Senior Funding Inc., HSBC Securities (USA) Inc., Credit Suisse Securities (USA) LLC, Societe Generale and Natixis are leading the deal that will help fund the acquisition of the Haynesville assets of Swepi LP and Shell Gulf of Mexico Inc., affiliates of Royal Dutch Shell plc, for $1.2 billion.

Closing is expected in the fourth quarter, subject to customary conditions and regulatory approvals.

Vine Oil is an exploration and production company formed by Blackstone Energy Partners.

Proserv reveals talk

Proserv had its bank meeting in the afternoon, and its $365 million first-lien term loan (B2) was launched with talk of Libor plus 500 bps to 525 bps with a 1% Libor floor, an original issue discount of 98 and 101 soft call protection for six months, a source said.

Additionally, the company’s $115 million second-lien term loan (Caa2) was launched at Libor plus 900 bps to 925 bps with a 1% Libor floor, a discount of 96 and call protection of non-callable for one year, then at 102 in year two and 101 in year three, the source continued.

The $540 million credit facility also includes a $60 million revolver (B2).

Commitments are due on Dec. 16, the source added.

Proserv lead banks

Goldman Sachs Bank USA, UBS AG, HSBC Securities (USA) Inc. and BNP Paribas Securities Corp. are leading Proserv’s credit facility, with Goldman the left lead on the first-lien debt and UBS the left lead on the second-lien debt.

Proceeds will be used to help fund the company’s buyout by Riverstone Holdings LLC from Intervale Capital, Weatherford International and certain minority shareholders.

Closing is expected this month, subject to certain regulatory approvals.

Proserv is an Aberdeen, Scotland-based energy services company.

Accuvant pricing surfaces

Accuvant launched with a bank meeting its $300 million first-lien term loan (B) with talk of Libor plus 450 bps to 475 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, according to a market source.

Meanwhile, the $125 million second-lien term loan (CCC+) was launched at Libor plus 875 bps to 900 bps with a 1% Libor floor, a discount of 99 and hard call protection of 102 in year one and 101 in year two, the source remarked.

Goldman Sachs Bank USA and Societe Generale are leading the $425 million of covenant-light term loans that will be used to help fund the merger of Denver-based Accuvant and Overland Park, Kan.-based FishNet Security, two providers of information security services.

Blackstone private equity funds will maintain majority ownership in the combined company, and current investors of both organizations, including existing management, the private equity firm Sverica International and FishNet Security’s corporate owner, Investcorp, are maintaining minority equity interests in the combined company.

Closing is expected in the first quarter of 2015, subject to regulatory approvals.

Impax sets guidance

Impax Laboratories launched with a bank meeting its $435 million six-year senior secured term loan with talk of Libor plus 450 bps with a 1% Libor floor, an original issue discount of 99, 101 soft call protection for six months, and a ticking fee of half the spread from days 31 to 60 and the full spread and floor thereafter, according to a market source.

The company’s $485 million credit facility also includes a $50 million five-year revolver.

Commitments are due at 5 p.m. ET on Dec. 16, the source said.

Barclays, RBC Capital Markets and Wells Fargo Securities LLC are leading the deal that will be used with cash on hand to fund the acquisition of Tower Holdings Inc., including operating subsidiaries CorePharma LLC and Amedra Pharmaceuticals LLC, and Lineage Therapeutics Inc. for $700 million in cash.

Senior secured and total leverage is 2 times, net total leverage is 1.3 times, the source added.

Impax is a Hayward, Calif., technology-based specialty pharmaceutical company. Tower Holdings and Lineage develop, manufacture and commercialize complex generic and branded pharmaceutical products.

CPM launches

CPM Holdings disclosed price talk on its first- and second-lien term loans with its morning bank meeting, according to a market source.

The $315 million seven-year first-lien term B (B1/B+) is talked at Libor plus 500 bps to 525 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, and the $100 million eight-year second-lien term loan (Caa1/B) is talked at Libor plus 900 bps to 925 bps with a 1% Libor floor, a discount of 98½, and hard call protection of 102 in year one and 101 in year two, the source said.

The company’s $445 million senior secured credit facility also includes a $30 million revolver (B1/B+).

Commitments are due on Dec. 16, the source added.

Morgan Stanley Senior Funding Inc. and Jefferies Finance LLC are the joint bookrunners on the deal and joint lead arrangers with Rabobank.

CPM, a Waterloo, Iowa-based supplier of process equipment used for oilseed processing and animal feed production, will use the new credit facility to refinance existing debt and pay a distribution to shareholders.

Siemens Audiology terms

Siemens Audiology Systems released talk of Libor/Euribor plus 450 bps to 475 bps with a 1% floor and an original issue discount of 99 on its €745 million equivalent U.S. and euro seven-year covenant-light term loan B, according to a market source. The loan has 101 soft call protection for six months.

The New York bank meeting to launch the deal to U.S. investors took place on Tuesday and a bank meeting to launch the deal to European investors will take place in London on Wednesday.

Commitments are due on Dec. 12.

Deutsche Bank Securities Inc., Goldman Sachs Bank USA and UBS AG are the physical bookrunners on the deal, with UniCredit a joint bookrunner. Goldman Sachs is left lead on the U.S. debt, and Deutsche Bank is left lead on the euro debt.

Proceeds will help fund the buyout of the company by EQT VI and Santo Holding from Siemens AG.

Siemens Audiology is a Singapore-based manufacturer and wholesaler of hearing aid devices.

Chief Power details

Chief Power Finance disclosed guidance of Libor plus 450 bps to 475 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year on its $325 million six-year term loan B that launched with an afternoon bank meeting, a market source said.

The company’s $365 million senior secured credit facility (Ba3) also includes a $40 million five-year revolver.

Commitments are due on Dec. 16, the source added.

Morgan Stanley Senior Funding Inc. and Barclays are leading the deal that will be used to fund Arclight Capital’s acquisition of Exelon Corp.’s interests in two fossil fuel power plants.

New Media comes to market

New Media Investment Group launched with a meeting on Tuesday its $170 million incremental term loan (B2/B+) due June 2020 with talk of Libor plus 550 bps to 575 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, according to a market source.

Commitments are due on Dec. 16, the source said.

Citizens Financial Group is leading the deal that will be used with cash on the balance sheet to fund the $280 million acquisition of Halifax Media Group.

Closing is expected in the first quarter of 2015, subject to customary conditions.

New Media is a New York-based publisher of locally based print and online media. Halifax Media is a Daytona Beach, Fla.-based newspaper publisher.

CRGT talk emerges

CRGT held its bank meeting in the afternoon, and a few hours prior to the event, talk on its $100 million six-year first-lien term loan came out at Libor plus 650 bps with a 1% Libor floor and an original issue discount of 98, a source remarked.

As previously reported, the term loan includes 101 soft call protection for one year.

The company’s $115 million credit facility (B), for which commitments are due on Dec. 15, also provides for a $15 million revolver.

Credit Suisse Securities (USA) LLC is leading the deal that will help fund the buyout of the company by Bridge Growth Partners LLC from Veritas Capital, although Veritas will continue to hold a minority stake.

As part of the transaction, GoldPoint Partners provided mezzanine debt financing and an equity co-investment.

CRGT, a Reston, Va.-based provider of custom software development and data analytics to federal government agencies, expects the buyout to close by year-end.

Bright Horizons brings loan

Bright Horizons Family Solutions launched during the session a $150 million non-fungible incremental term loan due January 2020 will be used for general corporate purposes, 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, the source remarked.

Commitments are due on Monday.

Goldman Sachs Bank USA is leading the deal.

Bright Horizons is a Watertown, Mass.-based leading provider of employer-sponsored child care, back-up care, early education, educational advisory services and other work/life services.

Eye-Mart launches

Eye-Mart held a bank meeting to launch its $330 million credit facility (B), however, price talk on the deal is not yet available as the company is waiting on a rating from Moody’s Investors Service, a source said.

The facility consists of a $30 million five-year revolver and a $300 million seven-year term loan B.

Wells Fargo Securities LLC is leading the deal that will be used to help fund the buyout of the company by Friedman Fleischer & Lowe LLC.

Other funds for the transaction will come from around $390 million of equity, the source added.

Eye-Mart is an eyewear company.

Amneal on deck

Also in the primary, Amneal Pharmaceuticals set a conference call for Wednesday afternoon to launch a fungible $250 million add-on first-lien covenant-light term loan due Nov. 2, 2019 that is talked at Libor plus 425 bps with a 1% Libor floor and an original issue discount of 99, according to a market source.

In connection with the add-on, the company is increasing pricing on its existing $490 million first-lien covenant-light term loan to Libor plus 425 bps with a 1% Libor floor from Libor plus 375 bps with a 1% Libor floor, and adding amortization of 2.5% as well as 101 soft call protection for six months to all of the first-lien term loan debt, the source remarked.

Commitments are due on Dec. 17.

Proceeds from the add-on will be used to fund a dividend.

GE Capital Markets is leading the deal for the Bridgewater, N.J.-based manufacturer of generic pharmaceuticals.

Emdeon readies loan

Emdeon scheduled a call for 11 a.m. ET on Wednesday to launch a $160 million term loan B-3 due Nov. 2, 2018, a market source remarked.

Bank of America Merrill Lynch is leading the deal that will be used for general corporate purposes, including acquisitions.

Emdeon is a Nashville-based provider of healthcare revenue and payment cycle management and clinical information exchange services.

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