Boyd, Maidenform hit the secondary with all institutional tranches quoted above par

By Sara Rosenberg

New York, May 14 - Boyd Gaming Corp.'s $1.5 billion credit facility (Ba2/BB) and Maidenform Inc.'s $180 million credit facility allocated and broke for trading on Friday, with Boyd's institutional term loan and Maidenform's first and second lien term loans all hitting plus par levels.

Boyd's $500 million term loan B was quoted at par 3/8 bid, par 5/8 offered, according to a trader. The tranche is priced with an interest rate of Libor plus 175 basis points, reverse flexed during syndication from price talk of Libor plus 200 basis points.

The credit facility also contains a $1 billion revolver.

Bank of America and CIBC are the lead banks on that deal that will be used to help fund the $1.3 billion merger with Coast Casinos Inc.

More specifically, proceeds will be used to refinance Coast's existing credit facility, Coast's 9½% bonds due 2009 and Boyd's existing credit facility.

Boyd Gaming is a Las Vegas gaming company. Coast Casinos is a Las Vegas owner and operator of hotel-casinos.

Maidenform breaks

Maidenform's credit facility broke for trading around lunchtime on Friday, with the $100 million first lien term loan priced at Libor plus 325 basis points (Ba3/B+) quoted at par ½ bid, 101 offered and the $50 million second lien term loan (B2/B) priced at Libor pus 750 basis points quoted at par ¼ bid, par ¾ offered, according to a trader.

"Most of the activity was in the first two hours of breaking since it's a Friday afternoon," the trader added.

Originally, the deal was launched as a $90 million first lien term loan with price talk of Libor plus 375 basis points and a $60 million second lien term loan with price talk of Libor plus 650 basis points. However, the syndicate opted to rework the structure as a result of better-than-expected ratings from both Moody's Investors Service and Standard & Poor's as well as the first lien being oversubscribed versus the second lien that was just barely getting done at original levels.

By the time the deal allocated, 35 accounts participated in the first lien and 16 accounts participated in the second lien.

The facility also contains a $30 million revolver.

BNP Paribas is the lead bank on the deal that was used to help fund Ares Corporate Opportunities Fund LP's acquisition of Maidenform from Oaktree Capital Management. The acquisition was actually completed this past Wednesday.

Oaktree, which had owned a majority interest in Maidenform, will continue to be a significant minority shareholder in the company.

Maidenform is a Bayonne, N.J., marketer and manufacturer of intimate apparel.

Cogentrix active

Cogentrix Energy Inc.'s delayed draw term loan was actively trading on Friday and quoted a little higher as the tranche has recently been fully funded, a trader said.

The term loan was quoted at par 3/8 bid, par 5/8 offered.

"The delayed draw term loan funded in three separate stages. It was par 1/8, par 3/8 before it fully funded. It recently funded up so it's been active with stronger buyers," the trader explained.

Cogentrix is a Charlotte, N.C., independent power producer.

Revlon falls

Revlon Inc.'s bank debt was said to be back down to the low to mid 90 context in which the paper was quoted prior to the company's refinancing plan being set in motion now that the decision was made to pull its deals from market, according to a few traders, although the paper was not seen trading in the wake of the news.

Prior to the decision to table the refinancing, Revlon's bank debt was around par since investors were anticipating being paid down at that level.

Late Thursday night, Revlon announced that it had abandoned its planned refinancing, which included getting a new $680 million credit facility, selling $400 million of senior notes and a tender offer, due to "current unfavorable market conditions."

The refinancing was to have been conducted through the New York cosmetics maker's Revlon Consumer Products Corp. subsidiary.

Revlon said it will continue to monitor market conditions and continue to execute its growth plan.

The refinancing had been intended to lower interest costs and extend debt maturities.

Revlon had been expected to close in mid-May on a new $680 million credit facility (B2/B) via JPMorgan and Citigroup. The facility included a $530 million six-year term B at Libor plus 425 basis points and a $150 million five-year revolver at Libor plus 325 basis points with a 50 basis points undrawn fee.

Syndication of the term loan B was not going well as of early in the May 10 week even though the company increased pricing on the tranche by 100 basis points and added soft call protection after price talk on the proposed bond offering headed higher.

More specifically, the term loan B, which was being offered at par, was flexed up to Libor plus 425 basis points from Libor plus 325 basis points, and 101 soft call protection was added as a result of price talk on the company's $400 million offering of seven-year senior unsecured notes coming in at 10.25% to 10.50%.

The tender offer was for the outstanding 8 1/8% senior notes due 2006, the 9% senior notes due 2006 and the 12% senior secured notes due 2005, as well as the related consent solicitation for the 2005 notes.

The tender offer had been set to expire at 5 p.m. ET on May 21 after being extended from May 14.

As previously announced, through noon ET on May 12, holders had tendered $360.07 million of the 12% notes, $18.125 million of the 8 1/8% notes and $7.285 million of the 9% notes.

Revlon had been offering to purchase $555 million of notes, consisting of any and all of its $363 million principal amount of outstanding 12% notes, any and all of its $116.2 million principal amount of outstanding 8 1/8% notes and any and all of its $75.5 million principal amount of outstanding 9% notes.

Loan market primary strong

Despite what seems to be a deteriorating high-yield bond market, with new issues either being scaled down in size (like Consolidated Container Co. LLC and many others) or pulled (as was just the case with Revlon), the primary bank loan market is still going strong as demand for the asset class keeps building.

"The problems in the bond market benefit the bank market," a market source said. "There's continued appetite with CLOs. Several CLOs just launched. Typically there's a lag between the bond market backing off and the bank market backing off. In this case, I think it will be a long lag. We'll see more of an immediate affect in the secondary market, not in terms of new deals getting done, unless they're based on a cheap bond deal."

Primedia closes

Primedia Inc. closed on its $100 million term loan due Dec. 31, 2009 with an interest rate of Libor plus 437.5 basis points, according to a company news release.

Proceeds from the term loan combined with proceeds from a $175 million offering of senior floating-rate notes due 2010 are being used to reduce debt and preferred stock outstanding.

The term loan, which was fully underwritten by some existing lenders, and the notes offering were done instead of the company's previously announced plans to sell $275 million of senior floating-rate notes.

In addition, in connection with the note sale, the company amended its credit facility (effective upon the incurrence of an additional $250 million of debt) changing the maximum allowable debt leverage ratio, solidifying the minimum interest coverage ratio at 2.25-to-1 through maturity, solidifying the minimum fixed charge coverage ratio at 1.05-to-1 through maturity, changing the mandatory revolver reductions and changing the term loan payment schedule.

More specifically, the maximum allowable debt leverage ratio is 6.25-to-1 and will decrease to 6.00-to-1 on Oct. 1, 2005, 5.75-to-1 on July 1, 2006, 5.50-to-1 on Oct. 1, 2006, 5.25-to-1 on April 1, 2007, 5.00-to-1 on Oct. 1, 2007, 4.75-to-1 on April 1, 2008 and 4.50-to-1 on and July 1, 2008, according to a 10-Q previously filed with the Securities and Exchange Commission.

The total mandatory reductions of the revolving loan commitments are $42.7 million in 2005, $64.05 million in 2006, $128.1 million in 2007 and a final reduction of $170.8 million in 2008.

The remaining term loan payments are $500,000 in 2004, $20.764 million in 2005, 2006 and 2007, $12.192 million in 2008 and $337.922 million in 2009.

Primedia is a New York media company.

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