First Eagle Investment breaks; Valeant term loans slide; T-Mobile moves up deadline to Monday

By Sara Rosenberg

New York, Oct. 30 – First Eagle Investment Management Inc.’s credit facility freed up for trading on Friday, and Valeant Pharmaceuticals International Inc.’s term loans weakened after the company announced that it is severing its relationship with Philidor Rx Services LLC.

Over in the primary market, T-Mobile USA Inc. moved up the commitment deadline on its term loan B, and U.S. Renal Care Inc., Avago Technologies Ltd. and Veritas Technologies Corp. set launches for their new deals.

First Eagle frees up

First Eagle Investment Management’s credit facility hit the secondary market on Friday. The $1.35 billion seven-year covenant-light term loan B was quoted at 98½ bid, 99 offered, according to a trader.

Pricing on the B loan is Libor plus 400 basis points with a 0.75% Libor floor, and it was sold at an original issue discount of 98. The debt has 101 soft call protection for one year and a ticking fee of half the spread starting on Dec. 2, increasing to the full spread after 30 days.

Recently, pricing on the term loan B was increased from talk of Libor plus 350 bps to 375 bps, the discount was revised from 99, the call protection was extended from six months, the MFN sunset was eliminated, the incremental free and clear was reduced and the excess cash flow sweep was tightened.

The company’s $1.5 billion senior secured credit facility (Ba1/BB+) also includes a $150 million five-year revolver priced at Libor plus 375 bps after flexing during syndication from talk of Libor plus 325 bps to 350 bps.

First Eagle lead banks

Morgan Stanley Senior Funding Inc., HSBC Securities Inc., Bank of America Merrill Lynch, Citigroup Global Markets Inc. and UBS AG are the bookrunners on First Eagle’s credit facility and joint lead arrangers with ICBC.

Proceeds will be used to help fund the buyout of the company by Blackstone and Corsair Capital from TA Associates for a total enterprise value of about $4 billion.

Closing is expected on Dec. 1, subject to receipt of consent by both First Eagle’s mutual fund board and fund shareholders as well as customary regulatory approvals.

First Eagle is a New York-based independent, privately held asset management firm.

Valeant softens

Also in trading, Valeant’s term loan C and D dipped to 93¼ bid, 93¾ offered from 93¾ bid, 94¼ offered, its term loan E slid to 93 bid, 93½ offered from 93 1/8 bid, 93 5/8 offered, and its term loan F fell to 93¼ bid, 93¾ offered from 93 3/8 bid, 93 7/8 offered during the session, a trader remarked.

In the morning, the company announced that it is cutting ties with Philidor and that it was informed by Philidor that Philidor will shut down operations as soon as possible, consistent with applicable laws.

The news release went on to say that Valeant informed Philidor that to the extent that managed care plans will no longer reimburse prescriptions in process, Valeant will fill them at the company’s expense.

In the third quarter, Philidor represented 6.8% of total Valeant revenue.

The move to separate itself from Philidor comes on the back of a Citron Research report that accused Valeant of fraud and brought into question dealings with Philidor.

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

T-Mobile shutting early

Meanwhile, in the primary market, T-Mobile accelerated the commitment deadline on its $1 billion seven-year covenant-light term loan B (Baa3/BBB-) to 5 p.m. ET on Monday from noon ET on Thursday, a market source said.

As previously reported, the term loan is talked at Libor plus 300 bps with a 0.75% Libor floor and an original issue discount of 99.5.

Deutsche Bank Securities Inc., Barclays, Citigroup, Goldman Sachs Bank USA and J.P. Morgan Securities LLC are leading the deal that will be used for general corporate purposes, which may include the acquisition of additional spectrum.

T-Mobile is a Bellevue, Wash.-based provider of wireless communications.

U.S. Renal coming soon

U.S. Renal Care set a bank meeting with a 1:30 p.m. ET registration time on Monday to launch a $2,165,000,000 credit facility, according to a market source.

The facility consists of a $150 million revolver, a $1.75 billion first-lien term loan and a $265 million second-lien term loan, the source said.

Barclays, JPMorgan, RBC Capital Markets, Deutsche Bank and Jefferies Finance LLC are leading the deal that will be used to refinance existing debt in connection with the merger of U.S. Renal and DSI Renal.

Closing on the merger is expected by the end of the fourth quarter, subject to regulatory and certificate of need approval in certain states.

Nashville-based DSI Renal and Plano, Texas-based U.S. Renal are providers of dialysis services.

Avago readies loan

Avago Technologies scheduled a bank meeting for Tuesday to launch a $7.5 billion seven-year covenant-light term loan B, a market source said.

Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC, Deutsche Bank, Barclays, Citigroup, Wells Fargo Securities LLC, BMO Capital Markets Corp., Nomura and Bank of Tokyo-Mitsubishi UFJ are leading the deal that will help fund the acquisition of Broadcom Corp. for $17 billion in cash and the equivalent of about 140 million Avago ordinary shares and to refinance existing debt.

Also for the Broadcom transaction, the company syndicated in August via left lead Credit Suisse a $500 million five-year revolver and a $4.25 billion five-year term loan A, which was upsized from $3.25 billion and is priced at Libor plus 150 bps to 200 bps, subject to a ratings-based grid.

Closing is expected in the first quarter of 2016, subject to regulatory approvals and the approval of Avago’s and Broadcom’s shareholders. The combined company will adopt the name Broadcom Ltd.

Avago is a Singapore and San Jose, Calif.-based semiconductor company. Broadcom is an Irvine, Calif.-based provider of semiconductor solutions for wired and wireless communications.

Veritas on deck

Veritas Technologies emerged with plans to hold a bank meeting on Monday to launch a secured credit facility that consists of a $300 million five-year revolver, a $2.45 billion seven-year covenant-light term loan and a €760 million seven-year covenant-light term loan, according to a market source.

Bank of America Merrill Lynch, Morgan Stanley, UBS, Jefferies, Barclays, Citigroup, Credit Suisse and Goldman Sachs are leading the deal.

Proceeds will be used to help fund the $8 billion buyout of the company by the Carlyle Group from Symantec Corp, which is expected to close by year’s end, subject to regulatory approvals and other conditions.

The buyout is also expected to be funded with $500 million of secured notes, $1,775,000,000 of unsecured notes and equity.

Veritas is a Mountain View, Calif.-based provider of storage and server management software solutions.

Jarden done at terms

In other news, Jarden Corp. wrapped syndication of its $200 million add-on term loan A due Dec. 17, 2019 at initial talk of Libor plus 175 bps with no floor, which is in line with existing term loan A pricing, with upfront fees of 15 bps for commitments of $5 million or less, 20 bps for commitments of more than $5 million and less than or equal to $10 million and 25 bps for commitments of more than $10 million, a source remarked.

The term A debt has a pricing grid that provides for a step-down to Libor plus 150 bps at less than 2.5 times total leverage and a step-down to Libor plus 125 bps at less than 2 times total leverage.

Barclays, Credit Suisse and UBS are leading the deal that allocated on Thursday.

Proceeds will be used to help fund the $1.5 billion acquisition of Visant Holding Corp. from investment funds managed by KKR, aPriori Capital Partners and other stockholders.

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

Jarden is a Boca Raton, Fla.-based consumer products company. Visant is a Minneapolis-based marketing and publishing services enterprise.

XPO closes

XPO Logistics Inc. completed its acquisition of Con-way Inc. for $47.60 per share, according to a news release.

To help fund the transaction, XPO got a new $1.6 billion six-year senior secured covenant-light term loan B priced at Libor plus 450 bps with a 1% Libor floor and sold at an original issue discount of 98. The debt has 101 soft call protection for one year and MFN for life.

During syndication, the term loan was downsized from $1.75 billion, the spread was raised from talk of Libor plus 400 bps to 425 bps and the discount widened from 98.5.

Morgan Stanley, JPMorgan, Barclays, Deutsche Bank, HSBC and Credit Agricole Securities Inc. led the deal.

XPO is a Greenwich, Conn.-based provider of supply chain solutions. Con-way is an Ann Arbor, Mich.-based transportation and logistics company.

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