OEConnection, Argus break; Shutterfly, Cerence, Vungle, Howden float changes

By Sara Rosenberg

New York, Sept. 24 – OEConnection LLC added a delayed-draw first-lien term loan to its transaction and finalized the spread and issue price on its first-lien term debt at the tight side of guidance, and Argus Media tightened pricing and original issue discount on its term loan B, and then both of these deal freed up for trading on Tuesday.

In more happenings, Shutterfly Inc. widened for a second time the spread and original issue discount talk on its term loan B, and Cerence Inc. lifted pricing on its term loan B, raised the floor, modified the issue price, shortened the maturity and revised documentation.

Also, Vungle Inc. reduced the size of its first-lien term loan B, increased the spread and revised original issue discount talk, and Howden downsized its term loan B and changed the spread and issue price.

Furthermore, BellRing Brands LLC and Allison Transmission Inc. disclosed price talk with launch, and MDVIP LLC emerged with new deal plans.

OEConnection tweaked

OEConnection added a $40 million delayed-draw first-lien term loan (B2) to its credit facilities, firmed pricing on the funded $422 million seven-year covenant-lite first-lien term loan (B2/B-) and the delayed-draw term loan at Libor plus 400 basis points the low end of the Libor plus 400 bps to 425 bps talk, and set the original issue discount at 99.5, the tight end of the 99 to 99.5 guidance, according to a market source.

The first-lien term loan debt still has a 0% Libor floor and 101 soft call protection for six months.

The company’s now $697 million of credit facilities, up from $657 million, also include a $50 million five-year revolver (B2/B-) and a $185 million privately placed second-lien term loan (Caa2/CCC).

Antares Capital, Golub Capital and Capital One Bank are leading the deal.

OEConnection frees up

On Tuesday, OEConnection’s strip of funded and delayed-draw first-lien term loan debt broke for trading, with levels quoted at 99¾ bid, par ¼ offered, the source added.

Proceeds will be used to help fund the buyout of the company by Genstar Capital from Providence Equity Partners LLC, and the delayed-draw term loan will be used to finance future acquisitions and growth initiatives.

Current investors Ford Motor Co. and General Motors will each retain their minority investments in the company upon completion of the buyout.

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

OEConnection is a Cleveland-based provider of SaaS solutions that help drive genuine original equipment parts sales and services across the entire automotive system.

Argus revised, trades

Argus Media lowered pricing on its $500 million term loan B (B2/B+) to Libor plus 325 bps from Libor plus 350 bps and modified the original issue discount to 99.75 from talk in the range of 99 to 99.5, a market source remarked.

The term loan still has a 0% Libor floor.

During the session, the term loan made its way into the secondary market and was quoted at par ¼ bid, par ¾ offered, the source added.

J.P. Morgan Securities LLC is the left lead on the deal that will be used for a dividend recapitalization.

Argus is a London-based media organization.

Shutterfly flexes again

Shutterfly lifted pricing on its $1 billion seven-year first-lien term loan B to Libor plus 600 bps from revised talk of Libor plus 550 bps and initial talk of Libor plus 525 bps, and adjusted original issue discount talk to a range of 95 to 96 from revised talk of 97 and initial talk in the range of 98 to 99, a market source said.

The term loan still has a 0% Libor floor.

Previously in syndication, the term loan was downsized from $1.285 billion, amortization was changed to 6.5% per annum from 5% per annum, and revisions were made to, among other things, MFN, incremental, debt/lien baskets, restricted payments and EBITDA definition.

The company’s $1.3 billion of senior secured credit facilities (B1/B) also include a $300 million revolver.

Commitments are due at 4 p.m. ET on Wednesday, the source added.

Shutterfly lead banks

Barclays, Citigroup Global Markets Inc., SunTrust Robinson Humphrey Inc., Credit Suisse Securities (USA) LLC, BMO Capital Markets, BNP Paribas Securities Corp., Deutsche Bank Securities Inc., HSBC Securities (USA) Inc., RBC Capital Markets LLC, Mizuho and UBS Investment Bank are leading Shutterfly’s credit facilities.

The new bank debt will be used with $785 million of senior secured notes, upsized from $500 million when the term loan was downsized, and equity to fund Shutterfly’s buyout by Apollo Global Management LLC for $51.00 per share in cash, or an enterprise value of about $2.7 billion, and the buyout of Snapfish LLC. Shutterfly and Snapfish will then be merged into one company.

Closing is expected by early in the fourth quarter, subject to customary conditions, including approval by Shutterfly stockholders and regulatory approval.

Shutterfly is a Redwood City, Calif.-based retailer and manufacturing platform for personalized products and communications. Snapfish is a San Francisco-based internet-based retailer of photography products.

Cerence reworked

Cerence increased pricing on its $425 million first-lien term loan B to Libor plus 525 bps from revised talk in the range of Libor plus 425 bps to 450 bps and initial talk of Libor plus 375 bps, changed the Libor floor to 1% from 0%, widened the original issue discount to 98 from revised talk of 99 and initial talk in the range of 99 to 99.5, and shortened the maturity to five years from seven years, according to a market source.

Additionally, amortization was increased to 2.5% in years one and two, 5% in years three and four and 7.5% onwards from 1% per annum, MFN was modified to 50 bps for life with carve-outs removed from 75 bps with a six month sunset, and the excess cash flow sweep was revised to 75%, stepping down to 50%, 25% and 0% at 2.75x, 2.25x and 1.75x first-lien net leverage, from 50%, stepping down to 25% and 0% at 2.75x and 2.25x first-lien net leverage, and carve-outs were removed from the sweep definition.

Also, changes were made to the asset sale sweep, incremental, available amount, restricted debt payments, general debt/liens basket, investments, restricted payments and EBITDA, the source said.

Cerence getting revolver

Along with the term loan B, Cerence’s $500 million of credit facilities (B2/B) include a $75 million revolver.

Commitments are due at 5 p.m. ET on Wednesday, the source added.

Barclays is the left lead on the deal that will be used to support the spinoff of Nuance Communications Inc.’s automotive software business segment into a new, independent, publicly traded company named Cerence.

Cerence is a Burlington, Mass.-based builder or automotive cognitive assistance solutions to power natural and intuitive interactions between automobiles, drivers and passengers, and the broader digital world.

Vungle changes surface

Vungle trimmed its seven-year covenant-lite first-lien term loan B to $315 million from $350 million, lifted pricing to Libor plus 550 bps from talk in the range of Libor plus 450 bps to 475 bps, changed original issue discount guidance to a range of 98 to 99 from just 99, and tweaked documentation, a market source remarked.

As before, the term loan has a 0% Libor floor and 101 soft call protection for six months.

The company’s now $365 million of senior secured credit facilities also include a $50 million five-year revolver.

Commitments are due at 3 p.m. ET on Wednesday, the source added.

Morgan Stanley Senior Funding Inc., Credit Suisse Securities (USA) LLC, Goldman Sachs Bank USA and Nomura Securities International Inc. are leading the deal that will be used to help fund the buyout of the company by Blackstone and pay fees and expenses related to the financing.

Closing is expected this year, subject to customary conditions.

Vungle is a San Francisco-based performance marketing platform for in-app video advertisements on mobile devices.

Howden modifies loan

Howden scaled back its covenant-lite term loan B to $900 million from $925 million, revised price talk to a range of Libor plus 500 bps to 525 bps from a range of Libor plus 425 bps to 450 bps, moved the original issue discount to 97 from 99 and extended the 101 soft call protection to one year from six months, a market source said.

Additionally, the company changed MFN, incremental, excess cash flow sweep, restricted payments and EBITDA definition.

The term loan still has a 0% Libor floor.

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

The company’s now $1.325 billion of credit facilities also include a $150 million revolver and a $275 million letter of credit facility.

Howden being acquired

Howden will use the new credit facilities, $300 million of senior notes and equity to fund its buyout by KPS Capital Partners LP from Colfax Corp. for $1.8 billion, including $1.66 billion in cash consideration and $140 million in assumed liabilities and minority interest.

To compensate for the smaller term loan B, the company will draw on its revolver.

J.P. Morgan Securities LLC, Barclays, BNP Paribas Securities Corp., RBC Capital Markets and HSBC Securities (USA) Inc. provided the debt commitment.

Closing is expected in the second half of this year, subject to customary conditions and approvals.

Howden is a Glasgow, Scotland-based provider of mission critical air and gas handling products and services to the industrial, power, oil & gas and mining industries.

BellRing reveals guidance

Also in the primary market, BellRing Brands held its bank meeting on Tuesday afternoon and, a few hours before the event began, price talk on its $820 million seven-year covenant-lite first-lien term loan (B2/B) emerged at Libor plus 350 bps with a 0% Libor floor and an original issue discount of 99.5, according to a market source.

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

Commitments are due at 5 p.m. ET on Oct. 8.

Based on a recent filing with the Securities and Exchange Commission, the company is also expected to get a $200 million revolver (B).

Credit Suisse Securities (USA) LLC, BofA Securities, Inc., Morgan Stanley Senior Funding Inc., Goldman Sachs Bank USA, Citigroup Global Markets Inc., J.P. Morgan Securities LLC and Barclays are leading the deal that will be used to repay corporate debt concurrently with the company’s initial public offering of common stock.

BellRing, currently owned by Post Holdings Inc., is a St. Louis-based active nutrition brand.

Allison details emerge

Allison Transmission launched on its afternoon call a $648 million senior secured covenant-lite term loan B due March 29, 2026 talked at Libor plus 175 bps with a 0% Libor floor, a par issue price and 101 soft call protection for six months, a market source said.

Citigroup Global Markets Inc. is leading the deal that will be used to reprice an existing term loan B down from Libor plus 200 bps with a 0% Libor floor.

Commitments from existing lenders are due at 5 p.m. ET on Oct. 7 and commitments from new lenders are due at noon ET on Oct. 8, the source added.

Closing is targeted for Oct. 11.

Allison Transmission is an Indianapolis-based automatic transmission company and supplier of hybrid-propulsion systems.

MDVIP readies loan

MDVIP set a lender call for 11 a.m. ET on Wednesday to launch a $45 million incremental first-lien term loan due Nov. 15, 2024, according to a market source.

The incremental term loan has 101 soft call protection for six months, the source said.

Jefferies LLC is leading the deal that will be used to fund a distribution to shareholders.

MDVIP is a provider of membership-based private health care services.

ECi Software allocates

In other news, ECi Software Solutions allocated its fungible $96 million incremental first-lien term loan and fungible $28 million incremental second-lien term loan in the morning, a market source remarked.

The first-lien term loan is priced at Libor plus 425 bps with a 1% Libor floor and was sold at an original issue discount of 99.5, and the second-lien term loan is priced at Libor plus 800 bps with a 1% Libor floor and was sold at a discount of 99.

The incremental and existing first-lien loans are getting 101 soft call protection for six months.

On Monday, the discount on the first-lien term loan was tightened from 99.

Golub Capital is leading the deal that will be used to fund the acquisition of Trivest Beheer BV, a Netherlands-based provider of smart vertical software solutions to the SME manufacturing sector.

Closing is expected in the third quarter, subject to customary conditions including regulatory approval.

ECi is a Fort Worth-based provider of enterprise resource planning software solutions to businesses across the distribution, field services, building and construction and manufacturing industries.

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