Cohu, Ciena, 8th Avenue Food, Garrett Motion, Peraton break; Restaurant Technologies tweaked

By Sara Rosenberg

New York, Sept. 21 – Cohu Inc. finalized the spread on its term loan B at the wide end of guidance before freeing up for trading on Friday, and deals from Ciena Corp., 8th Avenue Food & Provisions Inc., Garrett Motion Inc. and Peraton Corp. emerged in the secondary market as well.

In more happenings, Restaurant Technologies Inc. shifted some funds between its first-and second-lien term loans, lowered spreads on the tranches and tightened original issue discounts, and GoodRx and RevSpring Inc. joined the near-term primary calendar.

Cohu firms pricing

Cohu set the spread on its $350 million seven-year covenant-light senior secured term loan B (B1/BB-) at Libor plus 300 basis points, the high end of the Libor plus 275 bps to 300 bps talk, and modified the MFN to 50 bps for life from 75 bps for 12 months, according to a market source.

The term loan still has a 0% Libor floor and an original issue discount of 99.5.

Also included in the term loan is 101 soft call protection for six months.

Deutsche Bank Securities Inc. is leading the deal that will be used with cash on hand to fund the acquisition of Xcerra Corp. for $9.00 in cash and 0.2109 of a share of Cohu common stock. The transaction values Xcerra at about $796 million in equity value, with a total enterprise value of around $627 million, after excluding Xcerra’s cash and marketable securities net of the debt on its balance sheet as of Jan. 31.

Cohu hits secondary

After terms finalized, Cohu’s B loan freed up for trading and levels were quoted at 99¾ bid, par ½ offered, a trader added.

Closing is expected during the week of Oct. 1.

Secured leverage will be 2.7 times and net debt will be 1.7 times.

Xcerra shareholders are expected to own about 30% of the combined company at closing.

Cohu is a Poway, Calif.-based supplier of semiconductor test and inspection handlers, micro-electro mechanical system test modules, test contactors and thermal sub-systems. Xcerra is a Norwood, Mass.-based parent company of four brands in the semiconductor and PCB test industries.

Ciena frees up

Ciena’s $700 million seven-year covenant-light term loan B (Ba1/BB) began trading as well, with levels seen at par ¼ bid, par 5/8 offered, a trader said.

Pricing on the term loan is Libor plus 200 bps with a 0% Libor floor and it was sold at an original issue discount of 99.875. The debt has 101 soft call protection for six months.

On Thursday, pricing on the term loan B was flexed from Libor plus 225 bps and the discount was modified from talk in the range of 99.5 to 99.75.

Bank of America Merrill Lynch, Deutsche Bank Securities Inc. and J.P. Morgan Securities LLC are leading the deal that will be used to refinance the company’s existing term loan B and some of its convertible notes.

Ciena is a Linthicum, Md.-based supplier of communications networking equipment and software.

8th Avenue breaks

8th Avenue Food & Provisions’ bank debt freed to trade, with the $525 million seven-year first-lien term loan (B2) quoted at par ¼ bid, par ¾ offered and the $100 million eight-year second-lien term loan (Caa1) quoted at 99¾ bid, par ½ offered, according to a trader.

Pricing on the first-lien term loan is Libor plus 375 bps with a 25 bps step-down at 4.25 times first-lien leverage and a 0% Libor floor. The loan was sold at an original issue discount of 99.75 and has 101 soft call protection for six months.

The second-lien term loan is priced at Libor plus 775 bps with a 0% Libor floor and was issued at a discount of 99.25. This tranche has call protection of 102 in year one and 101 in year two.

On Thursday, the first-lien term loan was upsized from $500 million, the spread was trimmed from talk in the range of Libor plus 400 bps to 425 bps, the step-down was added and the discount was tightened from talk in the range of 99 to 99.5. Also, the second-lien term loan was downsized from $125 million, pricing firmed at the low end of the Libor plus 775 bps to 800 bps talk and the discount was revised from 98.5.

8th Avenue lead banks

Barclays, Goldman Sachs Bank USA, BMO Capital Markets, Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc. and Wells Fargo Securities LLC are leading 8th Avenue Food’s $625 million of term loans.

The new debt will be used to support the capitalization of the company as a stand-alone entity from St. Louis-based Post Holdings Inc., with a new investment from Thomas H. Lee Partners.

Under the agreement, Post is anticipated to receive total proceeds of $875 million. Post will retain 60.5% of the common equity in 8th Avenue. Thomas H. Lee will receive 8th Avenue preferred stock with an 11% PIK-equivalent, cumulative, quarterly compounding dividend and 39.5% of the common equity in the company.

Closing is expected on Oct. 1.

8th Avenue Food is a manufacturer of nut butters, healthy snacks, granola and pasta.

Garrett tops OID

Garrett Motion’s bank debt also hit the secondary market, with the $425 million seven-year term loan B quoted at par bid, par ½ offered, a trader remarked.

The company is also getting a €375 million seven-year term loan B.

Pricing on the U.S. 0% floor term loan is Libor plus 250 bps and pricing on the euro term loan is Euribor plus 275 bps. Both tranches have a 0% floor and 101 soft call protection for six months, and were sold at an original issue discount of 99.5.

During syndication, the total amount of term loan B debt was upsized from $750 million equivalent, pricing on the U.S. tranche was cut from talk in the range of Libor plus 275 bps to 300 bps and pricing on the euro tranche was lowered from the Euribor plus 300 bps area.

J.P. Morgan Securities LLC is leading the deal that will be used with notes, which were downsized with the term loan B upsizing, to help fund the spin-off of the company from Honeywell International Inc.

Garrett is a Switzerland-based manufacturer of turbocharger and electric-boosting technologies for light and commercial vehicle original equipment manufacturers and the aftermarket.

Peraton begins trading

Peraton’s $130 million add-on term loan (B1) due 2024 broke too, with levels quoted at 99½ bid, 99¾ offered, according to a market source.

Pricing on the add-on term loan is Libor plus 525 bps with a 1% Libor floor and it was sold at an original issue discount of 99.5.

Macquarie Capital (USA) Inc. is leading the deal that will be used to back the already completed acquisition of Strategic Resources International.

Peraton is a Herndon, Va.-based provider of satellite and terrestrial communications.

Restaurant Technologies reworked

Back in the primary market, Restaurant Technologies lifted its seven-year covenant-light first-lien term loan (B1/B-) to $400 million from $375 million, trimmed pricing to Libor plus 325 bps from talk in the range of Libor plus 350 bps to 375 bps, added a step-down to Libor plus 300 bps at 4.65 times first-lien net leverage and moved the original issue discount to 99.75 from 99.5, according to a market source.

Additionally, the company scaled back its eight-year covenant-light second-lien term loan (Caa1/CCC) to $100 million from $125 million, flexed pricing to Libor plus 650 bps from talk in the range of Libor plus 700 bps to 725 bps, and adjusted the discount to 99.5 from 99, the source said.

Documentation changes were made to reflect the increase in opening first-lien net leverage for all applicable ratios.

As before, both term loans have a 0% Libor floor and a 25 bps pricing step-down upon consummation of an initial public offering, the first-lien term loan has 101 soft call protection for six months and the second-lien term loan has call protection of 102 in year one and 101 in year two.

Restaurant getting revolver

Along with the first-and second-lien term loans, Restaurant Technologies’ $560 million of credit facilities include a $60 million five-year revolver (B1/B-).

Commitments were due at 5 p.m. ET on Friday, the source added.

Goldman Sachs Bank USA, RBC Capital, Credit Suisse Securities (USA) LLC, KeyBanc Capital Markets and Antares Capital are leading the deal that will be used to help fund the buyout of the company by Goldman Sachs Merchant Banking from Aurora Capital Partners. RBC is the administrative agent.

Restaurant Technologies is a Minneapolis-based provider of fresh oil delivery, used oil removal and efficiency monitoring solutions.

GoodRx coming soon

GoodRx set a bank meeting for 10 a.m. ET in New York on Tuesday to launch $560 million of first-lien credit facilities, according to a market source.

The first-lien facilities consist of a $40 million revolver and a $520 million first-lien term loan, the source said.

The company is also getting a $225 million second-lien term loan that has been privately placed.

Goldman Sachs Bank USA, Barclays, Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC, KKR Capital Markets, Citizens and SunTrust Robinson Humphrey Inc. are leading the deal that will be used to help fund the acquisition of significant minority stake in the company by Silver Lake Partners from existing owners Francisco Partners, Spectrum Equity and management.

GoodRx operates a prescription drug price comparison and coupon platform.

RevSpring on deck

RevSpring will hold a bank meeting at 10:30 a.m. ET on Tuesday to launch $400 million of senior secured first-lien credit facilities, a market source remarked.

The first-lien facilities consist of a $35 million five-year revolver and a $365 million seven-year first-lien term loan that has 101 soft call protection for six months, the source added.

The company is also getting a privately placed $120 million eight-year senior secured second-lien term loan that has hard call protection of 102 in year one and 101 in year two.

Jefferies LLC, Madison Capital and RBC Capital Markets are leading the deal that will be used to fund the acquisition of Apex Revenue Technologies and refinance existing indebtedness.

Closing is expected in the fourth quarter after the receipt of regulatory approvals.

RevSpring, a GTCR portfolio company, is a Livonia, Mich.-based provider of technology-driven multi-channel communication, workflow, payment, and analytics solutions for clients in the healthcare and financial services verticals. Apex Revenue is a St. Paul, Minn.-based provider of healthcare technology solutions.

PCI allocates

In other news, PCI Pharma Services (Packaging Coordinators Midco Inc.) allocated its fungible $50 million incremental first-lien term loan due July 1, 2023 on Friday, according to a market source.

Thee incremental first-lien term loan is priced at Libor plus 400 bps with a 1% Libor floor, in line with existing term loan pricing, and was issued at par. The debt has 101 soft call protection for six months.

During syndication, the issue price on the incremental loan was changed from 99.5.

Jefferies LLC is leading the deal that will be used with a pre placed $25 million incremental second-lien term loan to fund the acquisition of Sherpa Clinical Packaging.

Closing is expected on Sept. 28.

PCI is a Philadelphia-based pharmaceutical services provider. Sherpa is a San Diego-based provider of clinical trial material management services for clinical studies phases I-IV.

© 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.