Duravant, Fairbanks, Argus, Husky break; Science Applications, Copeland, Howden updated

By Sara Rosenberg

New York, Feb. 1 – Duravant LLC (Engineered Machinery Holdings Inc.) increased the size of its incremental first-lien term loan and firmed the original issue discount at the wide end of guidance, and Fairbanks Morse Defense (Arcline FM Holdings LLC) firmed issue prices on its incremental and repriced term loans at the tight side of talk, and then both of these deals freed to trade on Thursday.

Other deals to make their way into the secondary market during the session included Argus Media and Husky Injection Molding Systems Ltd.

In more happenings, Science Applications International Corp. changed the original issue discount on its term loan B, Copeland downsized its repriced term loan B as a result of a larger paydown from an upsized bond offering, and finalized the issue price, and Howden Group Holdings Ltd. terminated plans for a repricing of its U.S. term loan B, but is still in market with its new seven-year term loans.

Also, KITO Crosby (Crosby US Acquisition Corp.), Applied Systems Inc., Consumer Cellular (CCI Buyer Inc.), Ensono and Ascensus Group Holdings released price talk on their loan transactions with launch.

Duravant upsized, frees

Duravant raised its fungible incremental first-lien term loan due May 21, 2028 to $150 million from $125 million and set the original issue discount at 99.25, the wide end of the 99.25 to 99.5 talk, a market source said.

Pricing on the incremental term loan is SOFR+CSA plus 375 bps with a 25 bps step-down at less than 5x senior secured first-lien net leverage and a 0.75% floor, in line with existing term loan pricing. CSA is ARRC standard of 11.448 bps one-month rate, 26.161 bps three-month rate and 42.826 bps six-month rate.

Recommitments were due at 2 p.m. ET on Thursday and the incremental term loan broke in the afternoon, with levels quoted at 99¼ bid, 99½ offered, another source added.

Jefferies LLC, Societe Generale, UBS Investment Bank, Citigroup Global Markets Inc., KeyBanc Capital Markets, MUFG, Antares Capital, Fifth Third and Rabobank are leading the deal that will be used to repay revolver borrowings and to add cash to the balance sheet, with the loan upsizing adding more cash than initially planned.

Pro forma for the transaction, the first-lien term loan will total about $1.59 billion.

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

Fairbanks updated, trades

Fairbanks Morse Defense firmed the original issue discount on its fungible $125 million incremental first-lien term loan due June 23, 2028 at 99.5, the tight end of the 99.25 to 99.5 talk, and the issue price on its roughly $209.5 million repriced November 2023 incremental first-lien term loan due June 23, 2028 at par, the tight end of the 99.75 to par talk, according to a market source.

As before, the term loan debt (B3/B) is priced at SOFR+CSA plus 475 bps with a 0.75% floor, and has 101 soft call protection for six months. CSA is ARRC standard of 11.448 bps one-month rate, 26.161 bps three-month rate and 42.826 bps six-month rate.

The term loan started trading late in the day, with levels quoted at 99 5/8 bid, par 1/8 offered, another source added.

Jefferies LLC is leading the deal that will be used to prepay a portion of the company’s existing second-lien term loan, and the repricing will take the November 2023 loan down from SOFR+ARRC CSA plus 525 bps with a 0.75% floor and make the debt fungible with the company’s existing first-lien term loan.

Fairbanks Morse is a Beloit, Wis.-based provider of mission-critical propulsion and power generation systems, material handling devices, valves, actuators, motors and other hi-rel electrical components for the U.S. Navy and U.S. Coast Guard.

Argus Media breaks

Argus Media’s $1.2 billion seven-year term loan B (B2/B+) freed up too, with levels quoted at 99 7/8 bid, par ¼ offered, a trader remarked.

Pricing on the term loan is SOFR plus 325 bps with a 0% floor and it was sold at an original issue discount of 99.5. The debt has 101 soft call protection for six months.

During syndication, pricing on the term loan was lowered from SOFR plus 375 bps and the discount firmed at the tight end of the 99 to 99.5 talk.

JPMorgan Chase Bank, Citigroup Global Markets Inc., ING and SMBC are leading the deal that will be used to refinance an existing $479 million term loan B due 2026 and to return capital to certain shareholders.

Recently, the company announced that Adrian Binks, chairman and chief executive of Argus, along with General Atlantic, an existing Argus minority shareholder, will each consolidate their stakes in Argus, with General Atlantic and Argus itself acquiring shares from current minority shareholder Hg. Binks will become the majority owner of the company and General Atlantic will own a large minority of the company.

Argus is a London-based provider of intelligence to the global energy and commodity markets.

Husky hits secondary

Husky Injection Molding Systems’ $1.75 billion five-year covenant-lite term loan B (B3/B-) began trading during the session, with levels quoted at 98¾ bid, 99¼ offered, according to a market source.

Pricing on the term loan is SOFR plus 500 bps with a 0% floor and it was sold at an original issue discount of 98.5. The debt has 101 soft call protection for six months, and a ticking fee of half the spread for days 46 to 90, and the transaction must close within 90 days.

During syndication, the term loan was upsized from $1.3 billion, pricing was reduced from SOFR plus 525 bps, the discount was changed from 98, the ticking fee was added, revisions were made to J. Crew and portability, the agreement was revised to prohibit any restricted subsidiary from being designated as unrestricted if it owns or exclusively licenses any material IP, and covenants were adjusted upward 0.25x for increase in closing leverage except for unlimited restricted payments, which remained unchanged.

Husky refinancing

Husky will use the new term loan, $1 billion of secured notes and new preferred equity to refinance the company’s existing capital structure, including senior notes due 2026, senior PIK notes due 2025 and credit facilities borrowings, and to pay respective fees and expenses.

The notes were downsized from $1.3 billion and the equity contribution was downsized by $150 million with the recent term loan upsizing.

Deutsche Bank Securities Inc., BofA Securities Inc. and others to be announced are leading the loan.

Husky is a Bolton, Ont.-based provider of engineered tooling, services and systems primarily to the food and beverage packaging and medical end markets.

Science tightened

Science Applications modified the original issue discount on its up to $510.25 million seven-year senior secured covenant-lite term loan B (Ba1/BB+) to 99.75 from talk in the range of 99.25 to 99.5, according to a market source.

Pricing on the term loan remained at SOFR plus 187.5 bps with a 0% floor, and the debt still has 101 soft call protection for six months.

Recommitments are due at noon ET on Friday, the source added.

Citigroup Global Markets Inc. is the left lead on the deal that will be used to repay an existing term loan B due 2025 and term loan B-2 due 2027 and to pay fees and expenses.

Science Applications is a Reston, Va.-based technology integrator.

Copeland tweaked

Copeland trimmed its term loan B due May 2030 to $1,519,312,500 from a revised amount of $1,569,312,500 and an initial size of roughly $1.769 billion, and firmed the original issue discount at 99.875, versus initial talk of 99.75 to par for new money indications and a par issue price for existing lenders, a market source said.

Pricing on the term loan remained at SOFR plus 250 bps with a 0% floor, and the debt still has 101 soft call protection for six months.

Commitments were scheduled to be due at 4:30 p.m. ET on Thursday, after being extended from a revised deadline of 2 p.m. ET, a revised deadline of 1 p.m. ET and an initial deadline of 3 p.m. ET, the source added.

RBC Capital Markets is the left lead on the deal that will be used to reprice an existing term loan B due May 2030 down from SOFR plus 300 bps with a 0% floor. The loan is being paid down from roughly $2.269 billion with senior secured notes in connection with the repricing, and the U.S. and euro notes offering was upsized to about $750 million equivalent from a revised amount of roughly $700 million equivalent and an initial size of $500 million equivalent, resulting in the downsizing of the repriced term loan.

Copeland, owned by Blackstone, is a manufacturer of mission critical, highly engineered heating, ventilation, air conditioning and refrigeration components.

Howden modified

Howden Group terminated plans for a repricing of its $1.083 billion term loan B due 2030, but is still in market with a $3.435 billion seven-year term loan B and a €660 million seven-year term loan B, according to a market source.

The repricing was talked at SOFR plus 325 bps to 350 bps with a 0.5% floor and a par issue price, and would have taken the existing term loan due 2030 down from SOFR plus 400 bps.

Talk on the company’s U.S. seven-year term loan B remained at SOFR plus 325 bps to 350 bps with a 0.5% floor and an original issue discount of 99.5, and talk on the euro seven-year term loan remained at Euribor plus 400 bps with a 0% floor and an original issue discount of 99.5. The term loans (B2) have 101 soft call protection for six months.

The company also plans on getting a £630 million revolver.

Commitments for the U.S. term loan were scheduled to be due at 5 p.m. ET on Thursday, and commitments for the euro loan were scheduled to be due at noon ET on Thursday.

Howden lead banks

JPMorgan Chase Bank, Morgan Stanley Senior Funding Inc., BofA Securities Inc., Barclays, Goldman Sachs, RBC Capital Markets, Citigroup Global Markets Inc., HSBC Securities, ING, Lloyds, NatWest and Santander are leading Howden’s term loans. Morgan Stanley is the administrative agent.

The loans will be used with $750 million of senior secured notes and $500 million of senior notes to repay existing U.S. and euro term loans, to refinance an existing second-lien term loan and for general corporate purposes.

Specifically, the company plans to repay its $620 million SOFR plus 525 bps term loan due November 2027, its $2.708 billion Libor plus 325 bps term loan due November 2027, $253 million equivalent euro Euribor plus 450 bps term loan due November 2027, $688 million equivalent euro Euribor plus 350 bps term loan due November 2027 and $455 million second-lien term loan; to pay $67 million in estimated fees, expenses and original issue discounts; and to add $591 million to the balance sheet.

Howden Group is a London-based insurance intermediary group.

KITO holds call

KITO Crosby emerged in the morning with plans to hold a lender call at 2 p.m. ET on Thursday to launch a $1 billion 5.5-year first-lien term loan talked at SOFR plus 425 bps to 450 bps with a 0.5% floor, an original issue discount of 99 and 101 soft call protection for six months, according to a market source.

The company’s $1.12 billion of credit facilities also include a $120 million five-year revolver.

Commitments are due at 5 p.m. ET on Feb. 12, the source added.

UBS Investment Bank, KKR Capital Markets, SMBC, Mizuho, ING and Morgan Stanley Senior Funding Inc. are leading the deal that will be used to refinance the company’s existing capital structure.

KITO Crosby is a manufacturer and marketer of highly engineered equipment and solutions used in lifting, rigging, and custom material handling solutions.

Applied Systems launches

Applied Systems surfaced early in the day with plans to hold a lender call at 3:30 p.m. ET to launch $3.135 billion of credit facilities, split between a $150 million five-year revolver, a $2.365 billion seven-year first-lien term loan (B-) and a $620 million eight-year second-lien term loan (CCC), a market source remarked.

Talk on the first-lien term loan is SOFR plus 350 bps with a 0% floor, an original issue discount of 99.5 and 101 soft call protection for six months, and talk on the second-lien term loan is SOFR plus 550 bps to 575 bps with a 0% floor, a discount of 99.5 and call protection of 102 in year one and 101 in year two.

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

Nomura Securities, Jefferies LLC, JPMorgan Chase Bank, Macquarie Capital (USA) Inc., Morgan Stanley Senior Funding Inc. and Santander are leading the deal that will be used to refinance the company’s existing capital structure, repurchase minority equity share, and pay fees and expenses.

Applied Systems is a University Park, Ill.-based cloud software provider to the property & casualty and benefits insurance industry.

Consumer Cellular talk

Consumer Cellular held a lender call at 1 p.m. ET, launching a fungible $500 million incremental term loan B (B1) due Dec. 17, 2027 with original issue discount talk of 99.27, according to a market source.

Pricing on the incremental term loan is SOFR plus 400 bps with a 0.75% floor, and the debt has 101 soft call protection for six months.

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

BofA Securities Inc., Barclays, UBS Investment Bank and Jefferies LLC are leading the deal that will be used to fund a distribution to the direct or indirect shareholders of CCI Buyer, to redeem in whole or in part certain outstanding preferred stock, and to pay related fees and expenses.

Consumer Cellular is a Scottsdale, Ariz.-based provider of postpaid virtual wireless services with a major focus on the senior demographic.

Ensono guidance

Ensono came out with original issue discount talk of 99.04 on its fungible $100 million add-on term loan that launched with a lender call in the afternoon, a market source said.

Pricing on the term loan is SOFR+CSA plus 400 bps with a step-down to SOFR plus 375 bps and a 0.75% floor. CSA is ARRC standard of 11.448 bps one-month rate, 26.161 bps three-month rate and 42.826 bps six-month rate.

Commitments are due at 2 p.m. ET on Feb. 8, the source added.

KKR Capital Markets is leading the deal, which will be used for general corporate purposes.

Ensono is a Downers Grove, Ill.-based technology adviser, innovation partner and managed service provider.

Ascensus shops add-on

Ascensus Group held a lender call at 10 a.m. ET to launch a fungible $300 million add-on term loan due August 2028 talked with an original issue discount of 99.5, according to a market source.

Pricing on the add-on term loan is SOFR+CSA plus 350 bps with a 0.5% floor. CSA is ARRC standard of 11.448 bps one-month rate, 26.161 bps three-month rate and 42.826 bps six-month rate.

Commitments are due at 5 p.m. ET on Feb. 8, the source added.

JPMorgan Chase Bank and Stone Point Capital are leading the deal that will be used to repay a portion of the company’s existing second-lien term loan.

Ascensus is a Dresher, Pa.-based provider of technology-enabled administration services to the tax-advantaged savings market.

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