Epic Crude Services, Trico Group free to trade; Tallgrass Energy floats price guidance

By Sara Rosenberg

New York, Feb. 21 – Epic Crude Services made a number of documentation changes to its term loan B before breaking for trading on Thursday, and Trico Group LLC’s first-lien term loan debt emerged in the secondary market too.

In more happenings, Tallgrass Energy LP disclosed price talk on its term loan with launch.

Epic Crude tweaked

Epic Crude Services came out with documentation revisions to its $1 billion seven-year senior secured term loan B (B3/B+), including setting MFN at 50 bps for life versus the previously proposed 75 bps with a 12-month sunset, according to a market source.

Also, under incremental, the unlimited incremental governor was changed to 4 times from 4.5 times and the “no worse” clause was removed.

Furthermore, the excess cash flow sweep was modified to, following construction completion, 100% with step-downs to 75%, 50%, 25% and 0% when total net leverage is below 5.5 times, 4 times, 3 times and 2.5 times, respectively, the source said. Previously, the sweep was 50% with step-downs to 25% and 0% when total net leverage is below 4 times and 3.25 times, respectively.

Pricing on the term loan B remained at Libor plus 500 basis points with a 0% Libor floor and an original issue discount of 98.

As before, the term loan has hard call protection of 102 in year one and 101 in year two, amortization of 1% per annum and a minimum debt service coverage ratio covenant.

Epic hits secondary

Recommitments for Epic Crude Services’ term loan B were due at 1 p.m. ET on Thursday, and, later in the day, the debt freed to trade, with levels quoted at 98¾ bid, 99¾ offered, another source added.

The company’s $1,075,000,000 of credit facilities also include a $75 million super-priority revolver.

Goldman Sachs Bank USA, Barclays, Deutsche Bank Securities Inc., ABN Amro and Mirae are leading the deal that will be used to partially fund the crude pipeline construction project, fund associated debt service reserve and construction reserve accounts and pay related fees and expenses.

Equity investors are Ares Management Corp. and affiliates of Noble Energy Inc., Apache Corp. and Diamondback Energy.

Epic Crude Services is a 700-mile crude pipeline originating in the Permian and Eagle Ford Basins and terminating in Corpus Christi.

Trico frees up

Trico Group’s $255 million incremental first-lien term loan due February 2024 and rolled $464 million first-lien term loan began trading as well, with levels seen at 96¼ bid, 97¼ offered, a market source remarked.

Pricing on the incremental term loan and rolled loan is Libor plus 700 bps with a 1% Libor floor. The incremental loan was sold at an original issue discount of 96 plus a 1% fee, and existing lenders are getting a 1% roll fee for exchanging the existing $464 million first-lien term loan into a new tranche. The debt has hard call protection of 102 in year one and 101 in year two.

During syndication, the incremental term loan was upsized from $235 million and pricing finalized at the high end of the Libor plus 675 bps to 700 bps talk.

Pricing on the existing first-lien term loan prior to the roll was Libor plus 650 bps with a 1% Libor floor.

Trico getting second-lien

Along with the first-lien term loan debt, Trico is getting a $100 million second-lien term loan due February 2025 priced at Libor plus 900 bps cash plus 2% PIK with a 1% Libor floor. This tranche has call protection of 103 in year one, 102 in year two and 101 in year three.

Proceeds from the new debt will be used to fund the acquisition of Fram Group, and, due to the recent upsizing, to pay down ABL revolver borrowings.

Credit Suisse Securities (USA) LLC and FTI Capital Advisors are leading the debt.

Trico is a Rochester Hills, Mich.-based manufacturer of automotive aftermarket products.

Tallgrass sets guidance

Back in the primary market, Tallgrass Energy held its bank meeting on Thursday morning and in connection with the event, announced price talk of Libor plus 525 bps with a 0% Libor floor and an original issue discount of 98.5 on its $1,155,000,000 seven-year first-lien term loan (B1/B+/BB-), according to a market source.

The term loan has 101 soft call protection for one year.

Commitments are due at 5 p.m. ET on March 7.

Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc., Jefferies LLC and MUFG are leading the loan that will help fund Blackstone Infrastructure Partners’ acquisition of a controlling interest in the company for total cash consideration of about $3.3 billion.

Closing is expected this quarter, subject to customary conditions.

Tallgrass Energy is a Leawood, Kan.-based growth-oriented midstream energy infrastructure company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.