Bourland, Global Brass break; Dynegy up with buyout; NRG dips; Sinclair revises spread

By Sara Rosenberg

New York, Aug. 13 - Bourland & Leverich Supply Co. LLC's credit facility freed up for trading early on in the day Friday, with levels on the term loan quoted a few points above its original issue discount price, and Global Brass and Copper Inc. broke as well.

In more trading happenings, Dynegy Inc.'s strip of institutional bank debt was better as the company announced that it is being bought out, and NRG Energy Inc.'s loans were a little softer with news that it is buying assets from Dynegy and Kelson LP.

Over in the primary market, Sinclair Television Group Inc. reduced pricing on its well-received term loan B, and Centerplate Inc. is talking to some lenders about revisions it is willing to make on its proposed credit facility.

Also, Graham Packaging Co. Inc. disclosed additional details on the financing package for its pending acquisition of Liquid Container LP, including size of the new term loan D and bonds, and Bryant & Stratton College is getting ready to allocate its revised credit facility.

Bourland & Leverich trading

Bourland & Leverich's senior secured credit facility hit the secondary market on Friday, with the $125 million five-year term loan (B+) quoted at 97 bid, 98 offered, according to a market source.

Pricing on the term loan is Libor plus 900 basis points with a 2% Libor floor, and it was sold at an original issue discount of 95.

The tranche is non-callable for two years, then at 105½ in year three, 102¾ in year four and par in year five.

During syndication, pricing on the term loan firmed at the wide end of the initial Libor plus 850 bps to 900 bps talk, the discount was increased from the 97 to 98 area, and the call protection was sweetened from non-callable for one year, then at 102 in year two and 101 in year three.

Bourland being acquired

Proceeds from Bourland & Leverich's credit facility will be used to help fund the acquisition of the company by Jefferies Capital Partners.

Jefferies Finance is the lead arranger on the oversubscribed $200 million deal, which also includes a $75 million four-year ABL revolver that will be partially funded at closing.

Pro forma leverage is 2.9 times and equity will comprise 42% of capitalization.

Bourland & Leverich is a Pampa, Texas-based distributor of oil country tubular goods for U.S. onshore oil and gas producing regions.

Global Brass frees up

Another deal to start trading on Friday was Global Brass and Copper, with its $315 million five-year term loan (B) quoted at 98 bid, 98½ offered, according to a market source.

Pricing on the term loan is Libor plus 825 bps with a 2% Libor floor, and it was sold at an original issue discount of 97. There is call protection of 105 in year one, 103 in year two and 101 in year three.

During syndication, the term loan was downsized from $330 million, and the spread was increased from Libor plus 750 bps.

Goldman Sachs is the lead bank on the term loan.

Global Brass getting revolver

Global Brass and Copper's $465 million credit facility also includes a $150 million ABL revolver led by Wells Fargo that was syndicated to the company's existing bank group.

Proceeds from the term loan and ABL revolver will be used to refinance an existing $380 million ABL revolver and $60 million term loan.

The downsizing to the new term loan was because the company generated excess cash that was not reflected in the original deal terms. This excess cash is also being used to reduce the amount drawn on the new revolver at close to around $25 million from around $30 million. As a result, leverage at close is now 3.7 times, down from 3.96 times.

Global Brass and Copper is an East Alton, Ill.-based manufacturer and distributor of copper and copper-alloy sheet, strip, plate, foil, rod and fabricated components.

Dynegy rises

Dynegy's strip of institutional bank debt gained some ground in trading following news that the company is being acquired by the Blackstone Group LP in a transaction valued at $4.7 billion, including the assumption of existing debt, according to traders.

The strip was quoted by one trader at 98¾ bid, 99¼ offered, up from 95¾ bid, 96¾ offered, by a second trader at 99 bid, 99¾ offered, up from around the mid-90 context, and by a third trader at 98 7/8 bid, 99 1/8 offered, up from 96 bid, 97 offered.

Under the terms of the agreement, Dynegy stockholders will receive $4.50 in cash per share.

The transaction is expected to close by the end of 2010, subject to customary closing conditions, including approval by Dynegy stockholders and receipt of regulatory approvals.

Dynegy selling assets to NRG

In connection with its buyout agreement, Dynegy will be selling four natural gas-fired assets currently in California and Maine to NRG Energy for a cash consideration of $1.36 billion.

And, Blackstone's purchase of Dynegy is actually conditioned on the concurrent closing of the NRG transaction.

Closing on the buyout, however, is not subject to any financing conditions, and a fund managed by Blackstone has committed to contribute all of the equity necessary to complete the deal.

Dynegy is a Houston-based producer and seller of electric energy, capacity and ancillary services.

NRG softens

Meanwhile, NRG's bank debt was a little lower on the announcement that it is purchasing assets from Dynegy, as well as from Kelson, using cash and other funding sources, according to traders.

One trader had the extended term loan quoted at 98¾ bid, 99¼ offered, down from 98 7/8 bid, 99½ offered, and the extended letter-of-credit facility quoted at 97¼ bid, 98 offered, down from 97½ bid, 98¼ offered.

A second trader had the extended term loan quoted at 98 5/8 bid, 99 1/8 offered, down from 98 7/8 bid, 99 3/8 offered, and the extended letter-of-credit facility quoted at 97 1/8 bid, 97 5/8 offered, down from 97 3/8 bid, 97 7/8 offered.

The second trader also had the non-extended term loan quoted at 96 5/8 bid, 97 1/8 offered, down from 96 7/8 bid, 97 3/8 offered, and the non-extended letter-of-credit facility quoted at 95 3/8 bid, 95 7/8 offered, down from 95 5/8 bid, 96 1/8 offered.

NRG transactions to be accretive

NRG said in a press release on Friday that it expects the purchase of the Dynergy assets and the Kelson property to be accretive to adjusted EBITDA and free cash flow immediately.

The asset being acquired from Kelson is the Cottonwood Generating Station in Texas and the price is $525 million.

Both acquisitions are expected to close by year-end, subject to approvals from the Federal Energy Regulatory Commission and Department of Justice.

NRG is a Princeton, N.J.-based owner and operator of diverse power generation portfolios.

Sinclair reverse flexes

Switching to the primary market, Sinclair Television Group reduced pricing on its $270 million term loan B (Ba1/BB) due October 2015 to Libor plus 400 bps from Libor plus 425 bps, according to a market source.

The loan still has a 1.5% Libor floor, is being offered at an original issue discount of 99½ and provides for 101 soft call protection for one year.

JPMorgan is the lead bank on the deal that will be used, along with cash and/or revolver borrowings, to repay the company's existing $305 million term loan B that also matures in October 2015.

Pricing on the existing term loan B, which was obtained last year, is Libor plus 450 bps with a 2% Libor floor. The tranche was sold at an original issue discount of 98.

Sinclair is a Hunt Valley, Md.-based television broadcasting company.

Centerplate reworking facility

Centerplate has gone out to a select group of investors with changes to its proposed credit facility, and it appears as if people are now doing work on the deal and syndication could be completed, according to a market source.

Prior to these proposed changes, the deal had basically gone flat and, without them, it may have even have had to pulled and relaunched at a later date, the source said.

Details on the changes are not yet available, but the expectation is that more information will be coming out in the next few days.

Centerplate first launched its credit facility (B3/B+) on July 15, at which time it was presented as a $70 million revolver, a $50 million term loan A and a $194 million term loan B.

Price talk on the term loan B was Libor plus 625 bps to 675 bps with a 2% Libor floor and an original issue discount of 98.

Centerplate lead banks

Macquarie, UBS and BMO Capital Markets are the lead banks on the Centerplate credit facility, with Macquarie the left lead.

Proceeds will be used to refinance existing debt and fund a dividend payment.

Centerplate is a Stamford, Conn.-based provider of food and beverage concessions, high-end catering and merchandise services in sports facilities, convention centers and other entertainment facilities.

Graham Packaging reveals sizes

Graham Packaging said in an 8-K filed with the Securities and Exchange Commission on Friday that is plans on getting a new up to $300 million term loan D and selling up to $300 million of senior subordinated notes to fund its $568 million purchase of Liquid Container.

As a backup for the bonds, the company has received a commitment for a bridge loan.

When the acquisition was first announced a few days ago, the company remarked that it would get new bank debt under the $300 million accordion feature contained in its existing credit agreement and issue high-yield bonds.

The company had also said that the existing credit facility accordion feature allows for the refinancing of its term loan B, and that ability would not be lost with this transaction.

Graham leverage multiples

At close, Graham Packaging's leverage will be 4.7 times, up from 4.4 times currently, with the plan being to use cash flow to pay down debt.

Citigroup and Deutsche Bank are the lead banks on the new term loan D and bonds.

Closing on the transaction is expected to take place this year, subject to normal regulatory approvals and customary conditions.

Graham Packaging is a York, Pa.-based designer, manufacturer and seller of technology-based, customized blow-molded plastic containers. Liquid Container is a West Chicago, Ill.-based operator of blow molded plastic container plants.

Bryant readies allocations

Bryant & Stratton College is expected to allocate its credit facility on Monday now that changes have been made and syndication has wrapped up, according to a market source.

Under the recent changes, the term loan B was reduced to $135 million from $180 million, with pricing set at Libor plus 575 bps, up from talk of Libor plus 500 bps to 525 bps. The 1.5% Libor floor and original issue discount of 98 were left unchanged. There is 101 soft call protection for one year.

Also, a $30 million term loan A was added to the deal with pricing of Libor plus 550 bps and a 1.5% Libor floor.

Another change was that the facility now has a 31/2-year maturity, as opposed to the originally proposed five-year maturity.

The company's credit facility still includes a $40 million revolver.

Bryant cuts dividend

As a result of the downsizing of the facility to $205 million from $220 million, Bryant & Stratton College is reducing the dividend payment that it is paying with some of the proceeds from the new debt.

Other proceeds from the facility will also be used to refinance existing senior and mezzanine debt associated with the company's buyout in February 2008 by Parthenon Capital Partners.

GE Capital and Bank of America are the lead banks on the deal.

Pro forma leverage for the transaction is now 2.6 times, as opposed to 2.92 times under the original deal.

Bryant & Stratton College is a for-profit provider of post-secondary education with a network of 16 campuses in New York, Ohio, Virginia and Wisconsin, as well as online.

Chemtura pricing Monday

Chemtura Corp. said in a news release that it expects to price and allocate its term loan B on Monday.

The $300 million six-year term loan B (Ba1) is being talked at Libor plus 400 bps with a 1.5% Libor floor and an original issue discount of 98 to 99.

Bank of America, Barclays and Citigroup are the lead banks on the deal, with Bank of America the left lead.

Proceeds, along with $455 million of notes and a $275 million asset-based revolver, will be used for exit financing.

Pricing on the revolver is expected to be Libor plus 325 bps if availability is less than $100 million, Libor plus 300 bps if availability is $100 million to $200 million, and Libor plus 275 bps if availability is greater than $200 million.

Chemtura is a Middlebury, Conn.-based manufacturer and seller of specialty chemicals and polymer products.

Vertis downsizes facility

Vertis Holding Inc. cut its five-year first-out term loan (B2) to $365 million from $425 million and removed the $150 million second-out term loan from the capital structure, and as a result, the second-lien mezzanine notes were increased to $402 million, according to a market source.

Pricing on the first-out loan was left unchanged at Libor plus 900 bps with a 2% Libor floor and an original issue discount of 97, and there is still call protection of 104 in year one, 103½ in year two, 102 in year three and 101 in year four.

The company's now $555 million, down from $765 million, credit facility also includes a $190 million senior secured asset-based revolver that is being clubbed up with relationship banks.

Vertis refinancing debt

Proceeds from Vertis' credit facility will be used to refinance an existing term loan and $225 million revolver and fund the cash consideration for an exchange offer for the company's 18½% senior secured second-lien notes due 2012.

Credit Suisse and Citadel are leading the term loans.

GE Capital, Bank of America and Citibank have provided commitments toward the revolver, with GE the left lead.

Vertis is a Baltimore-based marketing communications company.

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