Navistar, Vertafore trade higher; RadNet, Hub cut spreads; Weight Watchers' $2.4 billion takes shape

By Paul A. Harris

Portland, Ore., March 28 - The LCDX 19 index of bank loan credit default swaps closed at 102¾ bid, 103¼ offered on Thursday, according to a market source.

Bank loan fund flows were flat on the week, according to a market source

The funds saw $1.3 million of inflows, the source said, citing a weekly report from Lipper-AMG.

In the bank loan secondary market, the new Navistar Inc. Libor plus 450 basis points term loan B due 2017 was seen at 100 and ¾ bid, 101½ offered, two by two, according to a market source.

The $700 million term deal priced at par earlier in the week.

Vertafore Inc. priced its $620 million Libor plus 325 bps first-lien covenant-light term loan due October 2019 (B1/B+), which priced at 99.75, allocated and traded at 100.5 bid, according to a trader who remarked that nearly all new issues presently appear to be trading toward the call prices.

In the primary market, Lightower Fiber Networks (LTS Buyer LLC) shifted $50 million of proceeds to its first-lien term loan from its second-lien loan.

RadNet Inc. and Hub International Holdings joined the parade of issuers that are ratcheting spread talk lower.

And Weight Watchers International Inc. set final tranche sizing and price talk for $2.4 billion of bank debt.

Lightower allocates

Lightower Fiber Networks first-lien term loan and second-lien loan both priced and allocated, a market source said on Thursday.

The company priced an upsized $$1.1 billion Libor plus 350 basis points seven-year first-lien term loan (B1/B) at 99.5.

The loan was upsized from $1.05 billion. The spread came on top of spread talk which was revised from earlier talk of 375 bps to 400 bps. The reoffer price came on top of price that was revised from earlier talk of 98.5 to 99.

The first-lien loan has a 1% Libor floor and 101 soft call protection for six months, and the second-lien loan has hard call protection of 103 in year one, 102 in year two and 101 in year three.

A pricing grid will be added so pricing steps to Libor plus 325 bps when total net leverage is less than 5.25 times.

Meanwhile, Lightower downsized its Libor plus 675 bps eight-year second-lien term loan (Caa1/CCC+) to $200 million from $250 million and priced it at 99. The spread was reduced from 750 bps.

The reoffer price came at the rich end of earlier price talk of 98.5 to 99.

The second-lien loan has a 1.25% Libor floor.

Call protection was changed as the deal now has hard calls at 102 and 101, revised from the earlier 103, 102, 101 calls.

The company's $1,425,000,000 credit facility also includes a $125 million five-year revolver (B1/B).

J.P. Morgan Securities LLC, Morgan Stanley Senior Funding Inc. and SunTrust Robinson Humphrey Inc. are the lead banks on the deal that launched with a bank meeting on Monday, with JPMorgan the left lead on the first-lien debt and Morgan Stanley the left lead on the second-lien debt.

Proceeds will be used to help fund the acquisition of Sidera Networks in a transaction valued at over $2 billion and led by Berkshire Partners.

Current Lightower investors include M/C Partners, Pamlico Capital and Ridgemont Equity Partners. Current Sidera investors include ABRY Partners and Spectrum Equity Investors.

Closing is expected in the second quarter, subject to regulatory approval.

Lightower is a Boxborough, Mass.-based metro fiber and bandwidth provider. Sidera is a New York-based provider of tailored, high-capacity communications services.

Vertafore allocates

Vertafore's $620 million term loan allocated and traded at 100.5 bid, according to a trader.

The spread came at the tight end of the Libor plus 325 to 350 bps spread talk.

The reoffer price came 25 cents rich to the discount talk of 99.5.

The loan features a 1% Libor floor and 101 repricing protection for one year.

The $695 million credit facility also has a $75 million revolver due April 2018.

Credit Suisse Securities (USA) LLC, Bank of America Merrill Lynch, Barclays and RBC Capital Markets are the lead banks on the deal.

Proceeds will be used to reprice and extend the company's existing credit facility. Currently, the company's term loan is priced at Libor plus 375 bps with a 1.5% Libor floor.

Vertafore is a Bothell, Wash.-based provider of software and information to the insurance distribution channel.

Rock Ohio deal

Rock Ohio Caesars (ROC Finance LLC) priced its $535 million six-year first-lien covenant-light term loan to Libor plus 375 basis points, on top of pricing that had been reduced pricing of Libor plus 450 bps to 475 bps, according to a market source.

The deal came with a 1.25% Libor floor, an original issue discount of 99½ and 101 soft call protection for one year.

The company's $570 million credit facility also includes a $35 million five-year revolver.

Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and Wells Fargo Securities LLC are the lead banks on the deal.

Proceeds will be used to refinance existing first-lien debt and fund the acquisition of the Higbee Building.

Rock Ohio is a casino operator in the Midwest. The company is a joint venture formed by Rock Gaming LLC and Caesars Entertainment Corp.

Fender sets final terms

Fender Musical Instruments Corp. set final terms for its $200 million six-year term loan B (B2/B) at Libor plus 450 basis points, 50 bps than the 500 bps spread talk, according to a market source.

The deal came at a reoffer price of 99, on top of discount talk.

The loan features a 1.25% Libor floor and has 101 soft call protection for one year.

J.P. Morgan Securities LLC is the lead bank on the deal that launched with a call on Wednesday afternoon.

Proceeds will be used to refinance an existing term loan B.

Fender is a Scottsdale, Ariz.-based maker of music instruments.

Dorncaster revises

Doncasters Group Ltd. revised tranche the sizes of its first- and second-lien covenant-lite term loans, increasing the dollar-denominated first-lien tranche while decreasing the sterling-denominated first-lien piece and the dollar-denominated second-lien piece, a market source said on Thursday.

The deal now features an upsized $620 million seven-year first-lien term loan (B2/B), upsized from $535 million, and a downsized £160 million seven-year first-lien term loan (B2/B), decreased from £200 million.

Also the 71/2-year second-lien term loan (Caa2/CCC+) was downsized to $290 million from $325 million.

Pricing on the U.S. first-lien loan is Libor plus 425 basis points with a 1.25% Libor floor and an original issue discount of 99, the sterling term loan is talked at Libor plus 475 bps with a 1.25% floor and a discount of 99, and the second-lien term loan is talked at Libor plus 825 bps with a 1.25% floor and a discount of 98, the source said.

Commitments were due by the Thursday close.

Credit Suisse Securities (USA) LLC, BofA Merrill Lynch and J.P. Morgan Securities LLC are the lead banks on the deal.

Included in the first-lien term loans is 101 soft call protection for one year, and the second-lien term loan has call protection of 103 in year one, 102 in year two and 101 in year three.

Proceeds will be used to refinance existing debt.

Doncasters is a U.K.-based manufacturer of complex precision components.

Radnet cuts pricing

RadNet cut pricing on its $389,125,000 senior secured term loan (B+) due Oct. 10, 2018 with price talk to Libor plus 325 basis points from the previous Libor plus 325 to 350 bps talk.

The Libor floor was decreased to 1% from 1.25% Libor floor.

The debt includes a $40 million incremental term loan, talked to price at 99.5, and $349,125,000 of existing term loan borrowings, talked at par.

There is 101 soft call protection for one year on the entire term loan.

Covenants include a maximum total leverage ratio and maximum capital expenditures.

Barclays, Deutsche Bank Securities Inc., GE Capital Markets and RBC Capital Markets are the lead banks on the deal.

Proceeds will be used to reprice the existing term loan from Libor plus 425 bps with a 1.25% Libor floor, to repay revolver debt and for general corporate purposes.

Commitments were due on Thursday.

Closing is expected in April.

RadNet is a Los Angeles-based owner and operator of fixed-site diagnostic imaging centers.

Hub trims spread

Hub International cut pricing on a $297 million add-on term loan and a repricing of its existing $828 million term loan, according to a market source.

The enlarged $1,125,000,000 term loan due June 13, 2017 is talked at Libor plus 350 basis points, down from 375 bps with no Libor floor and a par offer price, the source said.

In addition, the loan has 101 soft call protection for six months, the source remarked.

Proceeds from the add-on will be used to refinance a $168 million term loan due December 2017, repay $100 million of borrowings under the U.S. revolver and repay $25 million of preferred equity owned by legacy third-party shareholders.

The repricing will take the existing term loan down from Libor plus 450 bps with no Libor floor.

In addition, with this transaction the incremental facility will be reset to $125 million.

Commitments are due at 5 p.m. ET on Wednesday, and closing will occur on April 24 upon expiration of the existing 101 soft call protection, the source added.

Morgan Stanley Senior Funding Inc., Bank of America Merrill Lynch and RBC Capital Markets are the lead banks on the deal.

Hub is a Chicago-based insurance company.

U.S. Shipping five-year deal

U.S. Shipping Corp. set price talk for its $220 million five-year senior secured term loan B (B3/B), a market source said on Thursday.

The deal is talked with a Libor spread of 775 to 800 basis points, a 1.25% Libor floor and an original issue discount price of 99.

The loan becomes callable at 101 after one year and comes with 1% per annum amortization.

UBS Securities LLC is the left lead. BofA Merrill Lynch is the joint bookrunner.

The Edison, N.J.-based provider of long-haul marine transportation services plans to use the proceeds to refinance debt.

Weight Watchers sets sizes

Weight Watchers set final tranche sizing and price talk for $2.4 billion of bank debt, a market source said on Thursday.

A $350 million term loan B-1 due April 2016 is talked at a 275 basis points spread to Libor, discounted to 99, with a 101 soft call for 12 months.

A term loan B-2, sized at about $2.05 billion, is talked at a 300 basis points spread to Libor, with a 0.75% Libor floor, discounted to 98.5, with a 101 soft call for two years.

The coupon on both tranches steps up by 25 basis points should the company's credit ratings fall to Ba3 from Moody's Investors Service and BB- from Standard & Poor's. Currently, the respective ratings are Ba1 and BB-.

As reported, the company initially launched a single-tranche $2.4 billion term loan B due March 2020 on Monday with original issue discount talk of 99 to 991/2. It was guided at Libor plus 300 basis points with a 0.75% Libor floor and has 101 soft call protection for one year.

J.P. Morgan Securities LLC, BofA Merrill Lynch, HSBC Securities (USA) Inc., Scotia Capital (USA) Inc. and U.S. Bank are the lead banks on the deal.

Proceeds will be used to repay the company's existing term loan B due 2014, term loan C due 2015, term loan D due 2016, term loan E due 2017 and term loan F due 2019.

Weight Watchers is a New York-based provider of weight management services.

Dynegy schedules meeting

A bank meeting is set to take place at 2 p.m. ET on Tuesday to discuss the proposed Dynegy, Inc. $1.8 billion of credit facilities, according to a market source.

The deal features a $500 million two-year covenant-lite term loan B-1 with no call protection and an $800 million seven-year term loan B with a 101 soft call. There is also a $500 million five-year revolver.

Credit Suisse Securities (USA) LLC and Morgan Stanley & Co. are the active arrangers. Other managers are expected to be announced.

The Houston-based energy company plans to use the proceeds to refinance the credit facilities of subsidiaries GasCo and CoalCo.

OSI Restaurant repricing

Bloomin' Brands, Inc. (OSI Restaurant Partners, LLC) plans to complete a $975 million senior secured term loan B during the first half of April, according to a company press release.

Deutsche Bank Securities Inc. and BofA Merrill Lynch, Pierce are the joint lead arrangers.

Deutsche Bank, Merrill Lynch, Goldman Sachs Bank USA, J.P. Morgan Securities LLC and Morgan Stanley Senior Funding, Inc. are the joint lead bookrunners.

Proceeds will be used to refinance the existing $1 billion senior secured term loan B.

Bloomin' Brands is a portfolio of restaurant brands comprised of Outback Steakhouse, Carrabba's Italian Grill, Bonefish Grill, Fleming's Prime Steakhouse & Wine Bar and Roy's with more than 1,450 restaurants in 48 states, Puerto Rico, Guam and 19 countries.

© 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.