Wesco, LCDX 16 start trading; Surgery reworks deal; Citco sets talk; J. Jill mulls flex

By Sara Rosenberg

New York, April 4 - Wesco Aircraft Hardware Corp.'s credit facility hit the secondary market on Monday, with levels on the term loan B quoted above its original issue discount price, and the Markit LCDX 16 index began trading.

Over in the primary, Surgery Center Holdings Inc. made some changes to its oversubscribed credit facility, including lowering pricing and the original issue discount, slightly upsizing the term loan and adding soft call protection.

Also, J. Jill is expected to flex pricing higher on its term loan B, Citco Group of Cos. released price talk on its term loan in connection with its European launch, and LNR Property LLC and Mood Media Corp. firmed up timing on their credit facilities.

Wesco frees up

Wesco Aircraft Hardware's credit facility broke for trading on Monday, with the $350 million six-year term loan B quoted at par 3/8 bid, par ¾ offered on the open and then it moved up to par 5/8 bid, 101 offered, according to a trader.

Pricing on the term loan B is Libor plus 300 basis points with a step-down to Libor plus 275 bps when leverage is less than 2.5 times, but only after June 30, 2012, and a 1.25% Libor floor. The loan was sold at an original issue discount of 99¾ and includes 101 soft call protection for one year.

During syndication, the term loan B was downsized from $415 million, pricing firmed at the tight end of the Libor plus 300 bps to 325 bps talk, the step-down was added and the original issue discount was tightened from 991/2.

Wesco pro rata

Wesco's $765 million credit facility (Ba3/BB-) also includes a $150 million five-year revolver and a $265 million five-year term loan A, both priced in line with initial talk at Libor plus 300 bps with no Libor floor. The revolver has a 50 bps unused fee.

The term loan A was upsized from $200 million during syndication as a result of the term loan B downsizing.

Proceeds will be used to refinance existing debt.

Bank of America Merrill Lynch and Barclays Capital Inc. are the joint lead arrangers and bookrunners on the deal, with J.P. Morgan Securities LLC, Morgan Stanley & Co. Inc., RBC Capital markets LLC and Sumitomo bookrunners as well.

Wesco is a Valencia, Calif.-based integrated inventory management services provider and distributor of hardware and other components to the aerospace industry.

LCDX 16 tops par

Also in the secondary, the LCDX 16 index began trading with levels quoted at 100.2 on the open, according to one market source. Another source said it opened at par bid, par 3/8 offered and then moved to par 1/8 bid, par 3/8 offered in the afternoon, while a third source had it at par ¼ bid, par 3/8 offered by late day.

The fixed coupon for the index is 250 bps.

Companies added to the index include Carestream Health Inc., General Motors Holdings LLC, iStar Financial Inc., J. Crew Group Inc. and Univar Inc.

Removed from the index was DirecTV Holdings LLC, Dresser Inc., Hanesbrands Inc. Healthsouth Corp. and Hexion Specialty Chemicals Inc.

Surgery tweaks deal

Moving to the primary market, Surgery Center revised its credit facility size and pricing early on in the day and asked for recommitments by 5 p.m. ET Monday, with the hope being that allocations will go out later this week, according to a source.

Under the changes, the term loan was upsized to $240 million from $237.5 million and 101 soft call protection for one year was added, the source said.

Also, pricing on the term loan, as well as on a $20 million revolver, was reduced to Libor plus 500 bps from Libor plus 525 bps and the original issue discount moved to 99½ from 99, while the 1.5% Libor floor was left unchanged, the source continued.

Jefferies Finance LLC is the lead bank on the now $260 million senior secured credit facility (Ba3/B+) deal, up from $257.5 million.

Surgery buying NovaMed

Proceeds from Surgery Center's credit facility will be used to help fund the acquisition of NovaMed Inc. for $13.25 per share in cash. The transaction is valued at roughly $214 million, including the assumption or repayment of $105 million of debt.

The acquisition is expected to close in the second quarter, subject to customary conditions, including antitrust and regulatory approvals and stockholder approval.

Surgery Center is a Tampa, Fla.-based acquirer, developer and manager of free-standing ambulatory surgical centers. NovaMed is a Chicago-based operator, developer and acquirer of ambulatory surgery centers.

J. Jill may up spread

J. Jill, a Quincy, Mass.-based women's apparel retailer, is anticipated to increase pricing on its $120 million six-year term loan B (B), with official details on what the new pricing will be not yet announced, according to a market source. There are some rumors, however, that the spread may go all the way up into the Libor plus 850 bps context before syndication is done.

At launch, the term loan B was talked at Libor plus 550 bps with a 1.5% Libor floor and an original issue discount of 98.

The company's $160 million senior secured credit facility also includes a $40 million five-year ABL revolver with pricing that can range from Libor plus 225 bps to 275 bps based on a grid.

Credit Suisse Securities (USA) LLC is the lead bank on the deal that will be used to refinance an existing loan and help fund the acquisition of a majority position in the company by Arcapita Bank BSC from Golden Gate Capital.

Citco talk emerges

In more primary happenings, Citco held a bank meeting in London on Monday to launch its $490 million seven-year term loan to European investors, and with the event, price talk was announced, according to a market source.

The term loan is being guided at Libor plus 350 bps to 375 bps with a 1.25% Libor floor and an original issue discount of 991/2, the source said.

A bank meeting to launch the loan to U.S. lenders is set to take place in New York on Tuesday.

UBS Securities LLC and Deutsche Bank Securities Inc. are the lead banks on the deal that will be used to refinance existing debt.

Citco is a provider of financial services to hedge funds, private equity and real estate firms, institutional banks, companies and high net worth individuals.

American Rock launch

Also holding a bank meeting on Monday was American Rock Salt, as it launched a $250 million covenant-light term loan, according to a market source.

RBS Securities Inc. is the lead bank on the deal that will be used, along with $200 million of second-lien notes, to repay debt at the holding company and fund a dividend.

American Rock Salt is a Retsof, N.Y.-based producer of highway deicing rock salt.

LNR timing firms

LNR nailed down timing on its proposed $365 million senior secured credit facility (Ba2/BB+) with the scheduling of a bank meeting for Wednesday afternoon, according to a market source.

Previously, the deal was simply being labeled as this week's business.

The facility consists of a $325 million term loan B due 2016 and a $40 million revolver due 2014. Price talk is not yet available, the source said.

Goldman Sachs & Co. and Bank of America Merrill Lynch are the joint lead arrangers and joint bookrunners on the deal that will be used, along with cash on hand, to refinance existing bank debt.

LNR is a Miami-based diversified real estate, investment, finance and management company.

Mood Media meeting set

Mood Media Corp. has set a bank meeting for Tuesday to launch its previously announced $480 million credit facility that consists of a $25 million five-year revolver that is expected to be undrawn at close, a $390 million seven-year first-lien term loan and a $65 million 71/2-year second-lien term loan, according to a market source.

All tranches include a 1.5% Libor floor and will be offered at an original issue discount of 99, the source said, adding that the spreads are still to be determined.

However, a different source previous told Prospect News that that the first-lien term loan pricing could be around Libor plus 400 bps, or just north of 400 bps, depending on ratings.

The first-lien term loan has 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.

Mood Media funding acquisition

Proceeds from Mood Media's credit facility will be used to help fund the acquisition of Muzak Holdings LLC for $345 million, including net debt to be repaid on closing, and to refinance existing debt.

The acquisition is expected to close during the second quarter.

Credit Suisse Securities (USA) LLC is the lead bank on the credit facility and is asking for commitments by April 18.

The combined company will have LTM pro forma revenue of about $400 million and trailing LTM pro forma EBITDA in excess of $100 million.

Mood Media is a Toronto-based in-store media specialist. Muzak is a Fort Mill, S.C.-based provider of sensory branding services.

Global Defense buyout closes

In other news, the acquisition of Global Defense Technology & Systems Inc. by Ares Management LLC was expected to be completed on Monday, according to a news release. However, the $157.5 million credit facility (B3/B) that will be used to fund the transaction has not yet closed.

A market source explained that the sponsor is funding the buyout with all equity and, once the credit facility is completed, it will be used to take out some of that sponsor equity.

The credit facility consists of a $132.5 million six-year term loan B and a $25 million five-year revolver talked at Libor plus 550 bps with a 1.5% Libor floor and an original issue discount price of 99 on the term loan.

Price talk on the credit facility was recently flexed up from Libor plus 500 bps as a result of ratings coming out lower than expected.

Global Defense lead banks

Wells Fargo Securities LLC and SunTrust Robinson Humphrey Inc. are the lead banks on Global Defense's credit facility.

Commitments towards the facility are due form lenders by Friday.

Under the acquisition agreement, Global Defense was purchased for $24.25 per share. The transaction is valued at about $315 million, including the assumption of debt and prior to expenses.

Global Defense Technology is a McLean, Va.-based provider of mission-critical, technology-based systems and services for national security agencies and programs of the U.S. government.

Postmedia closes

Postmedia Network Inc. completed its $365 million term loan B priced at Libor plus 500 bps with a 1.25% Libor floor, according to a news release. The loan was sold at a discount of 99¾ and has 101 soft call protection for one year.

During syndication, pricing firmed at the wide end of talk of Libor plus 475 bps to 500 bps with a 99¾ to par offer price, and covenants were added to the initially covenant-light term loan B.

J.P. Morgan Securities LLC, Goldman Sachs & Co. and Morgan Stanley & Co. Inc. acted as the lead banks on the deal that was used to refinance existing term loan A and B borrowings.

The existing term loan A was priced at Libor plus 600 bps with a 2% Libor floor, and the term loan B was priced at Libor plus 700 bps with a 2% Libor floor.

Postmedia Network is an Ontario-based publisher of paid English-language daily newspapers in Canada.

© 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.