Sun Healthcare, RBS, Alaska break; Asurion, Metaldyne tweak; CB Richard sets launch, talk

By Sara Rosenberg

New York, Oct. 15 - Sun Healthcare Group Inc., RBS WorldPay and Alaska Communications Systems Group Inc. saw their credit facilities free up for trading during Friday's market hours, and all three companies' term loans were quoted above their original issue discount prices.

Over in the primary market, Asurion made some changes to its incremental term loan, including flexing pricing higher, increasing the original issue discount and adding soft call protection, and Metaldyne LLC upsized its term loan, while cutting pricing and the discount.

Also, CB Richard Ellis Group Inc. firmed up timing on the launch of its refinancing credit facility and released pricing guidance.

In addition, SoftLayer Technologies began circulating price talk on its bank deal as the transaction is getting ready for its upcoming launch, and Gateway Casinos & Entertainment emerged with plans to come to market with a new facility.

Sun Healthcare starts trading

Sun Healthcare's credit facility hit the secondary market on Friday, with the $225 million term loan quoted at 98 bid, 99 offered, according to a market source.

Pricing on the term loan is Libor plus 575 basis points with a 1.75% Libor floor, and it was sold at an original issue discount of 97.

During syndication, pricing on the term loan was increased from Libor plus 475 bps and the discount was widened from 981/2. Also, amortization was set at $10 million per year.

Of the total term loan amount, $75 million will cash collateralize letters of credit.

Credit Suisse, JPMorgan and RBC are the lead banks on the $285 million credit facility (Ba2/B+), which also includes a $60 million revolver.

Proceeds will be used to help repay the company's 9 1/8% senior subordinated notes and outstanding term loans and for general corporate purposes.

Sun Healthcare splitting up

Sun Healthcare's credit facility is in connection with its separation into two publicly traded companies.

The first company will be new Sun, a provider of nursing, rehabilitative and related specialty health care services, and manager of rehabilitation therapy, medical staffing services and hospice businesses.

The second company will be Sabra Health Care REIT Inc., an owner of substantially all of Sun's currently owned real property portfolio intended to operate as a real estate investment trust.

The separation will be done through a distribution to Sun stockholders of the common stock of the new Sun Healthcare Group and is expected to be completed in the fourth quarter, subject to regulatory, stockholder, final board and other approvals.

RBS WorldPay frees up

Another deal to break for trading was RBS WorldPay, with its £235 million seven-year dollar-equivalent term loan B-2 quoted at par ½ bid, 101 offered on the open and then moving in to par ¼ bid, par ¾ offered, according to sources.

Pricing on the term loan B-2 is Libor plus 450 bps with a 1.75% Libor floor, and it was sold at an original issue discount of 99.

During syndication, pricing on the term loan B-2 was cut from Libor plus 500 bps, and the discount firmed at the tight end of the initial 98 to 99 talk.

Goldman Sachs, Barclays, Morgan Stanley, RBS and UBS are the lead banks on the credit facility, with Goldman the left lead on the U.S. piece.

Proceeds from the facility will be used to help fund the acquisition of an 80.01% interest in the company by Advent International and Bain Capital from RBS Group for an enterprise value of up to £2.025 billion.

RBS WorldPay tranches

RBS WorldPay's £970 million secured credit facility (Ba2/BB) also includes a £75 million six-year revolver, a £75 million six-year capital expenditures facility, a £160 million six-year term loan A, a £325 million seven-year term loan B-1 priced at Libor plus 500 bps and a £100 million seven-year euro equivalent term loan B-3 priced at Euribor plus 475 bps.

The term loan B-1 and B-3 both have a 1.75% Libor floor and were sold at an original issue discount of 99.

During syndication, pricing on the term loan B-1 was reduced from Libor plus 525 bps, pricing on the term loan B-3 was reduced from Euribor plus 500 bps, and the discount on both firmed at the low end of the 98 to 99 talk.

Closing on the transaction is expected by the end of the year, subject to regulatory approvals.

RBS WorldPay is a provider of global payment processing services.

Alaska Communications frees

Alaska Communications' also started trading on Friday, with the $440 million six-year term loan B quoted at par bid, par ½ offered, according to a trader.

Pricing on the term loan B is Libor plus 400 bps with a 1.5% Libor floor, and it was sold at an original issue discount of 99.

The company's $470 million senior secured credit facility (Ba3/BB-) also includes a $30 million revolver.

JPMorgan is the lead bank on the deal that will be used to refinance and extend the maturity of the company's existing $426 million term loans due Feb. 1, 2012 and $45 million revolver due Feb. 1, 2011.

Alaska Communications is an Anchorage-based provider of broadband and other wireline and wireless services across businesses and consumers.

Asurion reworks loan

Switching to the primary, Asurion announced revisions to its $900 million incremental first-lien term loan in the morning that are geared towards attracting more lenders to the deal by Monday's commitment deadline, according to a market source.

Under the changes, the term loan is now talked at Libor plus 525 bps with a 1.5% Libor floor and an original issue discount of 98, the source said. By comparison, initial price talk on the deal had been Libor plus 450 bps with a 1.5% Libor floor and an original issue discount of 99.

Additionally, the term loan now has 101 soft call protection for one year, the source continued.

Barclays, Credit Suisse, Morgan Stanley and Goldman Sachs are the lead banks on the deal that will be used to fund a dividend.

Asurion is a Nashville, Tenn.-based provider of technology protection services.

Metaldyne revises size, pricing

Metaldyne also came out with changes to its term loan (B1/B+) on Friday, including upsizing it to $250 million from $225 million, reducing pricing to Libor plus 650 bps from Libor plus 750 bps and trimming the original issue discount to 99 from 98, according to a market source.

Left unchanged was the term loan's 2% Libor floor and soft call protection of 102 in year one and 101 in year two.

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

Deutsche Bank and Barclays Capital are the lead banks and are asking for commitments by noon ET on Monday. Closing is expected to take place on Thursday.

Metaldyne is a Plymouth, Mich.-based designer and supplier of metal-formed components and assemblies for engine and transmission applications.

CB Richard timing, talk

CB Richard Ellis nailed down timing on the launch of its proposed $1.35 billion senior secured credit facility (Ba1/BB) with the scheduling of a bank meeting for Tuesday, according to a market source.

The facility consists of a $700 million 41/2-year revolver, a $350 million five-year term loan A and a $300 million six-year term loan B.

Price talk on the revolver and the term loan A is Libor plus 225 bps, and price talk on the term loan B is Libor plus 350 bps.

The term loan B is being offered at an original issue discount of 99 and does not include a Libor floor, the source said.

CB Richard refinancing debt

Proceeds from CB Richard Ellis' credit facility will be used to help refinance $1.5 billion of existing bank debt.

Other funds for the refinancing will come from about $500 million of cash on hand and $350 million of notes.

The notes priced earlier this month at par to yield 6.625%.

Credit Suisse, Bank of America and HSBC Securities are the lead banks on the credit facility.

CB Richard Ellis is a Los Angeles-based commercial real estate services firm.

SoftLayer floats talk

SoftLayer Technologies released price talk on its proposed $275 million credit facility in preparation for the Tuesday bank meeting that will be held to kick off syndication on the transaction, according to market sources.

Both the $20 million five-year revolver and the $255 million six-year term loan are being guided at Libor plus 450 bps to 500 bps with an original issue discount of 98 to 981/2, sources said.

In addition, the term loan has a 1.75% Libor floor, while the revolver has no floor, sources remarked.

SunTrust and RBC Capital are the lead banks on the deal for the Dallas-based provider of on-demand data center and hosting services, with SunTrust the left lead.

Net leverage will be under 2.5 times.

SoftLayer funding merger

Proceeds from SoftLayer's credit facility will be used to help fund a merger with ThePlanet.com Internet Services, a Houston-based provider of internet infrastructure services that is owned by GI Partners (as is SoftLayer).

In June, SoftLayer approached the loan market with a $230 million credit facility led by Deutsche Bank and SunTrust, consisting of a $20 million revolver, a $20 million delayed-draw term loan and a $190 million term loan. Price talk on the term loans had been Libor plus 525 bps to 550 bps with a 1.75% Libor floor and an original issue discount of 99.

The deal, however, was not getting done at those terms. Rumors were circulating that the company was evaluating a bunch of options, including increasing pricing into the Libor plus 600 bps territory and revising amortization.

In the end, some sort of bank deal was completed, but details on the financing were not released.

Proceeds from that credit facility were used to help fund GI Partners buyout of the company.

Gateway Casinos readies deal

Gateway Casinos & Entertainment is set to hold a bank meeting on Wednesday to launch a proposed $285 million credit facility that consists of a $35 million revolver and a $250 million five-year first-lien term loan, according to a market source.

Jefferies, RBS, Goldman Sachs, JPMorgan and Morgan Stanley are the lead banks on the deal.

Proceeds from the facility, along with $250 million of seven-year second-lien notes, will be used to refinance an exit financing term loan.

Gateway Casinos is a Burnaby, B.C.-based casino and entertainment company.

Knology closes

In other news, Knology Inc. closed on its $770 million credit facility (B1/B+), consisting of a $50 million revolver, a $175 million five-year term loan A and a $545 million six-year term loan B, according to a news release.

Pricing on all tranches is Libor plus 400 bps. The term loan B has a 1.5% Libor floor and was sold at an original issue discount of 99.

During syndication, pricing on the term loan B was lowered from Libor plus 450 bps, the floor was trimmed from 1.75% and the discount was tightened from 981/2. Also, the term loan B was downsized from $570 million and the term loan A was upsized from $150 million.

Credit Suisse and SunTrust acted as the lead banks on the deal that was used, along with cash on hand, to fund the $165 million acquisition of Sunflower Broadband and to refinance existing debt.

Knology is a West Point, Ga.-based provider of interactive communications and entertainment services. Sunflower is a provider of video, voice and data services to residential and business customers.

AutoTrader.com wraps

AutoTrader.com completed its acquisition of vAuto, an Oak Brook, Ill.-based provider of advanced software tools for used vehicle management, pricing and inventory optimization, according to a news release.

To help fund the transaction, AutoTrader.com got a $100 million incremental term loan (BB+) priced at Libor plus 450 bps with no Libor floor, which was sold at an original issue discount of 991/2.

Wells Fargo and Goldman Sachs acted as the lead banks on the deal.

AutoTrader.com is an Atlanta-based automotive marketplace and consumer information website.

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