Reedy Industries, LendingTree loans free to trade; Fairbanks Morse Defense joins calendar

By Sara Rosenberg

New York, Aug. 24 – Reedy Industries finalized the original issue discount on its first-lien term loan debt at the tight end of guidance before breaking for trading, and LendingTree’s term loan B made its way into the secondary market as well.

In more happenings, Fairbanks Morse Defense surfaced with plans to bring an incremental first-lien term loan and amendment request to market this week.

Reedy updated

Reedy Industries set the original issue discount on its $325 million seven-year covenant-lite first-lien term loan (B2/B-) and $76 million delayed-draw first-lien term loan (B2/B-) at 99.5, the tight end of the 99 to 99.5 talk, according to market sources.

As before, the first-lien term loan debt is priced at Libor plus 450 basis points with a 0.75% Libor floor and has 101 soft call protection for six months.

Delayed-draw ticking fees are half the spread from days 46 to 90 and full spread thereafter.

The company’s $575.5 million of credit facilities also include a $65 million revolver (B2/B-) and a $109.5 million pre-placed second-lien term loan, of which $16 million is a delayed-draw tranche.

Reedy breaks

On Tuesday afternoon, Reedy Industries’ first-lien term loan debt freed to trade, with levels quoted at par 1/8 bid, par 5/8 offered, sources added.

Truist, Antares Capital, Ares and Blackstone are leading the deal that will help fund the buyout of the company by Partners Group from Audax Private Equity.

Closing is targeted for Aug. 31.

Reedy Industries is a Deerfield, Ill.-based provider of commercial heating, ventilation and air conditioning services.

LendingTree hits secondary

LendingTree’s $250 million seven-year term loan B also began trading during the session, with levels quoted at 99½ bid, par ¼ offered, a market source remarked.

Pricing on the term loan is Libor plus 400 bps with a 0.75% Libor floor and it was sold at an original issue discount of 99. The debt has 101 soft call protection for six months.

In addition to the term loan B, the company’s $450 million of credit facilities (Ba3/BB-) include a $200 million revolver.

Truist is leading the deal that will be used to refinance existing debt and for general corporate purposes.

Closing is expected on Sept. 15.

LendingTree is a Charlotte, N.C.-based online lending marketplace.

Fairbanks on deck

In other news, Fairbanks Morse Defense will hold a lender call at noon ET on Wednesday to launch a fungible $202.5 million incremental first-lien term loan due June 23, 2028 talked with an original issue discount of 99 to 99.5, a market source said.

Pricing on the incremental first-lien term loan is Libor plus 475 bps with a 0.75% Libor floor.

The company is also getting a fungible $42.5 million privately placed incremental second-lien term loan due June 23, 2029.

Jefferies LLC, BMO Capital Markets and UBS Investment Bank are leading the deal that will be used with additional cash equity to fund an acquisition.

Fairbanks amendment

In addition to the incremental debt, Fairbanks Morse Defense is looking to amend its existing credit agreement to revise the leverage-based incurrence tests for debt and liens to be set off 5.25x first-lien net leverage/6.75x total net leverage, the source continued.

Commitments for the incremental first-lien term loan and amendment consents are due at noon ET on Sept. 1, the source added.

Lenders are being offered a 12.5bps consent fee for the amendment.

Fairbanks Morse Defense is a Beloit, Wis.-based provider of propulsion systems, ancillary power, motors and controllers for the U.S. Navy and U.S. Coast Guard, and provider of associated parts and maintenance services.

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