Duravant, ArcLight GCX break; Sally Beauty revises deadline; SubCom price talk emerges

By Sara Rosenberg

New York, Feb. 15 – Duravant LLC (Engineered Machinery Holdings Inc.) increased the size of its incremental first-lien term loan and modified the original issue discount before freeing up for trading on Wednesday, and ArcLight GCX’s (AL GCX Holdings LLC) term loan B broke as well.

In more happenings, Sally Beauty Holdings Inc. accelerated the commitment deadline for its term loan B, SubCom released price talk on its incremental first-lien term loan with launch, and TMS International Corp. joined this week’s primary calendar.

Duravant tweaked, frees

Duravant raised its fungible incremental first-lien term loan (B1/B-) due May 21, 2028 to $150 million from $130 million and changed the original issue discount to 99.25 from 98.79, according to a market source.

Like the existing first-lien term loan, the incremental term loan is priced at Libor plus 350 basis points with a 25 bps step-up at more than 5x senior secured first-lien net leverage and a 0.75% floor.

Commitments were due at 2 p.m. ET on Wednesday, accelerated from 2 p.m. ET on Thursday, and the incremental term loan broke for trading in the afternoon, with levels quoted at 99¼ bid, 99¾ offered, a trader added.

Jefferies LLC is the left lead on the deal that will be used to repay revolver borrowings and, due to the upsizing, to add cash to the balance sheet.

Pro forma for the transaction, the first-lien term loan size is about $1,357,800,000.

Duravant is a Downers Grove, Ill.-based automation solutions company providing highly engineered equipment and related aftermarket parts and services.

ArcLight hits secondary

ArcLight GCX’s roughly $615,385,032 senior secured term loan B (Ba3/B+) due May 18, 2029 also freed to trade, with levels quoted at 99 7/8 bid, par 3/8 offered, a market source remarked.

Pricing on the term loan is SOFR+CSA plus 350 bps with a 0.5% floor. The debt was sold at an original issue discount of 99.75 for new money and a par issue price for existing lenders. CSA is 10 bps one-month rate, 15 bps three-month rate and 25 bps six-month rate.

Barclays is the left lead on the deal that will be used to reprice an existing first-lien term loan B down from SOFR+CSA plus 375 bps with a 0.5% floor. CSA on the existing loan is 10 bps one-month rate, 15 bps three-month rate and 25 bps six-month rate.

ArcLight GCX is a new-build 450-mile Permian natural gas pipeline.

Sally Beauty accelerated

Sally Beauty moved up the commitment deadline for its $400 million seven-year term loan B (Baa3) to 2 p.m. ET on Thursday from 11 a.m. ET on Friday, a market source said.

Talk on the term loan is SOFR plus 300 bps with a 0% floor, an original issue discount of 99, 101 soft call protection for six months and 0 bps CSA.

BofA Securities Inc., JPMorgan Chase Bank, Truist, Citizens, Regions and US Bank are leading the deal that will be used to refinance an existing term loan B due 2024.

Sally Beauty is a Denton, Tex.-based retailer and distributor of professional beauty supplies.

SubCom guidance

SubCom held its lender call on Wednesday morning and announced talk on its $470 million incremental first-lien term loan (B1/B+) due April 2027 at SOFR+CSA plus 500 bps to 525 bps with a 0.75% floor, an original issue discount of 98 and 101 soft call protection for six months, according to a market source.

CSA is 11 bps one-month rate, 26 bps three-month rate and 43 bps six-month rate (ARCC Recommend Fallback CSA).

Commitments are due at 5 p.m. ET on Feb. 23, the source continued.

Goldman Sachs Bank USA is the left lead on the deal that will be used to return capital to shareholders and pay related fees and expenses.

With this transaction, pricing on the company’s existing term loan will migrate to SOFR+ARRC CSA via a negative consent amendment effective at 5 p.m. ET on Feb. 22, the source added.

SubCom is an Eatontown, N.J.-based subsea fiber optic cable turnkey services provider, with engineering, manufacturing, installation and maintenance capabilities.

TMS readies deal

TMS International set a lender call for Thursday to launch a $450 million seven-year term loan B (B1/BB-) talked at SOFR plus 475 bps with a 0.5% floor, an original issue discount of 97 to 98 and 101 soft call protection for six months, a market source remarked.

Commitments are due at 5 p.m. ET on Feb. 24, the source added.

JPMorgan Chase Bank is leading the deal that will be used to refinance an existing term loan B due August 2024.

TMS is a Pittsburgh-based provider of on-site, industrial steel mill services for steelmakers.

Fund flows

In other news, actively managed loan fund flows on Tuesday were negative $141 million and loan ETFs were negative $30 million, market sources said.

Loan indices rise

IHS Markit’s iBoxx loan indices were stronger on Tuesday, with the Leveraged Loan indexes (MiLLi) closing out the day up 0.04% and the Liquid Leveraged Loan indices (LLLi) closing out the day up 0.02%.

Month to date, the MiLLi is up 0.82% and year to date it is up 3.42%, and the LLLi is up 0.62% month to date and up 3.27% year to date.

Average secondary market bids in the U.S. on Tuesday were 92.04, up 0.01% from the previous day and up 0.16% year to date.

According to the IHS Markit data, some of the top advancers on Tuesday were National CineMedia’s June 2018 term loan B at 35.60, up from 34.14, NielsenIQ’s November 2021 U.S. covenant-lite term loan at 90, up from 87.33, and Endo Pharmaceuticals’ March 2021 covenant-lite RSA term loan B at 80.44, up from 78.31.

Some top decliners on Tuesday were Mitel Networks’ November 2018 covenant-lite fourth out no roll up term loan at 24.95, down from 25.79, Convergeone’s January 2019 covenant-lite term loan at 65.08, down from 66.32, and Wheel Pros’ May 2021 covenant-lite term loan at 70.88, down from 72.10.

© 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.