Sinclair slides with add-on loan plans; Global Tel reworks deal; 99 Cents timing emerges

By Sara Rosenberg

New York, Nov. 28 - Sinclair Television Group Inc.'s term loans were weaker in the secondary market on Monday as the company surfaced with plans for incremental term loans to fund two previously announced acquisitions.

Over in the primary market, Global Tel*Link Corp. made a round of changes to its oversubscribed credit facility that involved increasing the size of the term loan B and tightening the original issue discount, as well as lowering coupon on all tranches.

Also, 99 Cents Only Stores firmed timing on the launch of its credit facility and NCO Group Inc., Endurance International Group, Phoenix Services LLC, Sterling Infosystems Inc. and Landry's Inc. joined this week's calendar as well. Barrington Broadcasting Group LLC came out with structure on its upcoming deal.

Sinclair loans soften

Sinclair Television's term loans were weaker in trading on Monday as news surfaced that the company will launch $530 million of incremental term loans with a lender call at 3:30 p.m. ET on Tuesday, according to traders.

The term loan A was quoted at 98 bid, 98¾ offered and its term loan B was quoted at 98¾ bid, 99¼ offered, traders said. One trader said the last levels he had before the news were from Nov. 22, at which time the A loan was 99 bid, 99½ offered, and the B loan was 99¾ bid, par ¾ offered. And, a second trader was quoting the B loan at 99¼ bid, par ¼ offered on Friday.

The new debt consists of a $250 million incremental term loan A due March 2016 talked at Libor plus 225 bps and a $280 million incremental term loan B due October 2016 talked at Libor plus 300 bps with a 1% Libor floor. Original issue discounts are still to be determined.

Sinclair amending facility

Along with the incremental loans, Sinclair is looking to amend its existing credit facility to increase the revolver to $100 million from $75.4 million.

Additionally, the amendment would extend the revolver maturity to March 2016 from 2013.

The company also is asking to increase incremental loan capacity and television station acquisition capacity and gain more flexibility under covenants.

J.P. Morgan Securities LLC is leading the deal.

Sinclair funding acquisitions

The proceeds from Sinclair's new term loan borrowings, cash on hand and/or a revolver draw, will be used to fund the $385 million acquisition of Freedom Communications' broadcast assets, including eight stations. The proceeds also will be used to fund the $200 million acquisition of Four Points Media Group LLC from Cerberus Capital Management LP.

Closing on the Freedom transaction is expected in early January and on the Four Points transaction in late March. As a result, about $350 million of the new term loan debt is expected to be done on a delayed-draw basis.

Sinclair is a Hunt Valley, Md.-based television broadcasting company. Freedom is an Irvine, Calif.-based media company operating print publications, broadcast television stations and interactive businesses. Four Points is an owner and operator of seven stations.

Global Tel tweaks facility

In more loan happenings, Global Tel*Link came out with issuer-friendly revisions to its well received credit facility (B2), including lifting the size, which increased leverage to 4.25x from 4.05x, and reducing pricing, according to a market source.

Under the new structure, the six-year term loan B is sized at $635 million, up from $605 million, and pricing is Libor plus 550 bps with a 1.5% floor and an original issue discount of 98, versus initial talk of Libor plus 600 bps with a 1.5% floor and a discount of 97, the source said. The 101 soft-call protection for one year was left intact.

Also, pricing on the $50 million five-year revolver, size unchanged, was flexed to Libor plus 550 bps from Libor plus 600 bps, the source continued. There is still a 1.5% Libor floor on this tranche as well.

Global Tel being purchased

The proceeds from Global Tel*Link's credit facility will help fund the company's buyout by American Securities from Veritas Capital and GS Direct.

The equity funding for the transaction has been downsized by $30 million as a result of the term loan B upsizing, the source added.

Credit Suisse Securities (USA) LLC, UBS Securities LLC, GE Capital Markets and Nomura are the lead banks on the credit facility.

Global Tel*Link is a Mobile, Ala.-based correctional communications technology company.

99 Cents reveals timing

99 Cents Only Stores, a City of Commerce, Calif.-based operator of extreme value retail stores, nailed down timing on the launch of its $675 million credit facility with the scheduling of a bank meeting for 10:30 a.m. ET on Thursday, according to a market source.

The credit facility consists of a $150 million five-year ABL revolver and a $525 million seven-year term loan.

While official price talk is not yet out, the company did disclose expected pricing in filings with the Securities and Exchange Commission, outlining the ABL revolver at Libor plus 200 bps with a 37.5 bps unused fee, and the term loan at Libor plus 600 bps with a 1.5% Libor floor and 101 soft-call protection for one year.

Pricing on the ABL revolver is expected to range from Libor plus 175 bps to 225 bps, and the unused fee from 37.5 bps to 50 bps, based on average excess availability.

99 Cents lead banks

RBC Capital Markets, BMO Capital Markets and Deutsche Bank Securities Inc. are the joint lead arrangers and bookrunners on 99 Cents' credit facility. The initial financing commitment came from RBC and BMO, but Deutsche joined the group shortly after.

The proceeds from the credit facility, $635.9 million of equity and a $250 million bridge loan commitment will be used to fund the purchase of the company by Ares Management LLC and Canada Pension Plan Investment Board for $22.00 per share in cash in a transaction with a total equity value of about $1.6 billion.

The one-year bridge loan is expected to be priced at Libor plus 950 bps with a 1.5% Libor floor. After three months, the spread will increase by 50 bps each full fiscal quarter thereafter.

Closing is targeted for the first quarter of 2012, subject to shareholder approval and the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act.

NCO readies deal

NCO Group set a bank meeting for 9:30 a.m. ET on Wednesday to launch an $870 million credit facility that consists of a $120 million revolver and a $750 million term loan, according to a market source.

Barclays Capital Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC and RBS Securities Inc. are the lead banks on the deal.

The proceeds, along with $300 million of bonds and $300 million of equity, will be used to back the already completed acquisition of APAC Customer Services Inc. by One Equity Partners for about $470 million, and merger with One Equity's portfolio company, NCO Group, and to refinance existing debt at both companies.

The combined company is being renamed Expert Global Solutions.

NCO is a Horsham, Pa.-based provider of business process outsourcing services. APAC is a Bannockburn, Ill.-based provider of customer care services.

Endurance coming soon

Another company announcing a Wednesday launch was Endurance International, with the bank meeting for its $400 million credit facility set for 10:00 a.m. ET, according to a market source.

The facility consists of a $50 million five-year revolver and a $350 million six-year term loan B, the source said, adding that the B loan has 101 soft-call protection for one year.

Credit Suisse Securities (USA) LLC is leading the deal that will be used to help fund the purchase of the company by Warburg Pincus and GS Capital Partners from Accel-KKR, which will retain a minority interest in the company.

Leverage is 3.5x on a secured basis.

Endurance is a Burlington, Mass.-based provider of web hosting and online services to small- and medium-sized businesses.

Phoenix joins calendar

Phoenix Services came aboard with Wednesday bank meeting plans too, at which time the company will launch a $245 million credit facility led by BNP Paribas Securities Corp., according to a market source.

The facility consists of a $30 million five-year revolver, a $60 million five-year euro equivalent term loan, a $140 million six-year term loan and a $15 million six-year delayed-draw term loan that is available for three months, the source said.

Senior leverage is 2.75x.

The proceeds will be used by the Kennett Square, Pa.-based provider of steel mill services to fund the acquisition of Gagneraud Industries, a Paris-based provider of metal production services to mills, and to refinance existing debt.

Sterling sets launch

Also surfacing with new deal plans was Sterling Infosystems, with the company launching a $180 million credit facility with a bank meeting on Wednesday, according to a market source.

The facility consists of a $20 million revolver and a $160 million term loan, the source said.

GE Capital Markets and RBS Citizens are the lead banks on the deal, which will be used to refinance existing debt and fund an acquisition.

Sterling Infosystems is a New York-based background screening company.

Landry's plans add-on

Continuing on the new-deal front, Landry's revealed that it will hold a lender call on Tuesday to launch a $50 million add-on term loan that is being led by Jefferies & Co. and Wells Fargo Securities LLC, according to a market source.

The proceeds from the loan and $90 million of 11 5/8% senior secured notes due 2015 will be used to help fund the acquisition of McCormick & Schmick's Seafood Restaurants Inc. for $8.75 per share in cash for a total equity value of about $131.6 million.

Closing is expected in late December/early January, subject to the tender of a majority of shares, the expiration of the waiting period under Hart-Scott-Rodino and other customary conditions.

Landry's is a Houston-based full-service restaurant, hospitality and entertainment company. McCormick & Schmick's is a Portland, Ore.-based operator of seafood restaurants in the upscale dinning segment.

Barrington structure surfaces

Details on Barrington Broadcasting Group's proposed credit facility emerged on Monday as the company is getting ready to launch the transaction with a bank meeting at 9:30 a.m. ET on Wednesday, according to a market source.

The $195 million facility consists of a $10 million revolver and a $185 million term loan, the source said.

Bank of America Merrill Lynch and Wells Fargo Securities LLC are the lead banks on the deal, which will be used to refinance existing debt.

Barrington is a Schaumburg, Ill.-based owner and operator of network affiliated television stations.

Lightower closing this year

In other news, Lightower Fiber Networks will be asking lenders to commit to its proposed $150 million incremental term loan A by Dec. 13, with a plan to close before the end of the year, a market source told Prospect News.

As was previously reported, the loan is set to launch a bank meeting on Tuesday and is talked at Libor plus 450 bps with no Libor floor.

GE Capital Markets and SunTrust Robinson Humphrey Inc. are leading the deal. It will be shopped primarily to banks and will be used to fund a dividend payment.

With this new deal, pricing on the company's existing revolver and term loan A will be increased to Libor plus 450 bps from Libor plus 300 bps.

Lightower Fiber Networks is a Boxborough, Mass.-based metro fiber network and bandwidth service provider.

Entercom wraps deal

Entercom Communications Corp. closed on its $425 million senior secured credit facility (Ba3/BB-) consisting of a $375 million seven-year term loan and a $50 million five-year revolver, according to a regulatory filing.

Pricing on the revolver is Libor plus 500 bps and pricing on the term loan is Libor plus 500 bps with a step down to Libor plus 475 bps at less than 5x leverage and a 1.25% Libor floor. The term loan was sold at an original issue discount of 98 and has 101 soft-call protection for one year.

During syndication, the term loan was upsized from $345 million, the pricing step down was added and the discount moved from 97.

Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC and Morgan Stanley & Co. LLC led the deal that was used by the Bala Cynwyd, Pa.-based radio broadcasting company to refinance existing debt and for general corporate purposes.

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