Mattress Firm frees to trade; Vizient tweaks loan; Vivid Seats details surface with launch

By Sara Rosenberg

New York, Feb. 3 – Mattress Firm Holding Corp.’s incremental first-lien term loan made its way into the secondary market during Wednesday’s session, and the debt was seen bid right around its original issue discount.

Moving to the primary market, Vizient Inc. reduced the size of its term loan due to an increase in the amount of bonds it is issuing, Vivid Seats Ltd. released price talk on its term loan with launch, and MedRisk LLC surfaced with new deal plans.

Mattress Firm breaks

Mattress Firm’s $665 million senior secured incremental first-lien term loan (Ba3/B+) due Oct. 20, 2021 began trading on Wednesday, with levels quoted at 97 bid, 97½ offered, according to a trader.

Pricing on the term loan is Libor plus 525 basis points with a 1% Libor floor, and it was sold at an original issue discount of 97. The debt has 101 soft call protection for one year.

During syndication, the term loan was downsized from $730 million, pricing was raised from revised talk of Libor plus 500 bps and initial talk of Libor plus 450 bps to 475 bps, the discount widened from talk of 98.5 to 99, the call protection was extended from six months, and a total net leverage covenant was added to the originally covenant-light loan.

In addition to the incremental term loan, the company is getting a $200 million amended and extended ABL revolver.

Mattress funding acquisition

Proceeds from Mattress Firm’s new debt and cash on hand will be used to fund the purchase of HMK Mattress Holdings LLC, the holding company of Sleepy’s and related entities, for $780 million, subject to working capital and other customary adjustments.

Barclays is the lead left bookrunner on the deal.

With the incremental term loan, the company is revising its existing $693 million term loan due Oct. 20, 2021 to mirror all terms of the new loan. As a result, the existing term loan will have pricing set at Libor plus 525 bps with a 1% Libor floor, 101 soft call protection for one year and a total net leverage covenant.

Net secured and net total leverage is 3.9 times.

Mattress Firm is a Houston-based mattress retailer. Sleepy’s is a Hicksville, N.Y.-based mattress retailer.

Central Security holds steady

Also in trading, Central Security Group Inc.’s fungible $50 million incremental first-lien term loan due Oct. 6, 2020 (B2/B-) was quoted at 97 bid, 98 offered, in line with where it broke for trading on Tuesday, a trader remarked.

Pricing on the incremental and existing first-lien term loan is Libor plus 562.5 bps with a 1% Libor floor, and the debt has 101 soft call protection for six months. The incremental loan was sold at an original issue discount of 97.

Credit Suisse Securities (USA) LLC is leading the deal that is being used to repay revolver borrowings.

Central Security is a Tulsa, Okla.-based provider of alarm monitoring services.

Vizient downsizes

Switching to the primary market, Vizient cut its seven-year secured covenant-light term loan to $1,375,000,000 from $1,475,000,000 in connection with upsizing its notes offering to $500 million from $400 million, a market source said.

As launched, the term loan is talked at Libor plus 500 bps with a 1% Libor floor, an original issue discount of 98 and 101 soft call protection for six months.

The company’s now $1.45 billion credit facility also includes a $75 million five-year revolver.

Commitments are due at noon ET on Friday.

Barclays is leading the debt that will be used to fund the acquisition of the Spend and Clinical Resource Management and Sg2 businesses from MedAssets Inc.

Closing is expected this quarter.

Vizient is an Irving, Texas-based network of not-for-profit health care organizations.

Vivid talk emerges

Vivid Seats held its bank meeting on Wednesday morning, at which time lenders were presented with a $240 million seven-year first-lien term loan with talk of Libor plus 550 bps to 575 bps with a 1% Libor floor, an original issue discount of 98 and 101 soft call protection for six months, according to a market source.

Prior to launch, the transaction was broadly described as $240 million in first-lien debt.

Commitments are due at 5 p.m. ET on Feb. 17.

RBC Capital Markets and SG Americas Securities LLC are leading the loan that is being done in connection with the company’s strategic partnership with Vista Equity Partners.

Vivid is a Chicago-based full-service secondary ticket marketplace for live sports, concerts and theater events.

MedRisk coming soon

MedRisk set a bank meeting for 2 p.m. ET in New York on Monday to launch a $227.5 million senior credit facility, a market source remarked.

The facility consists of a $25 million five-year revolver and a $202.5 million seven-year term loan, the source continued.

Antares Capital is leading the deal that will be used with $80 million of mezzanine financing to support a significant minority investment by TA Associates in the company. The current management team will retain a majority stake and continue to operate the business.

TA Associates and management are primarily providing the mezzanine debt, the source added.

MedRisk is a King of Prussia, Pa.-based provider of outpatient physical medicine network services to the U.S. workers’ compensation industry.

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