Momentive slides as amendment is pulled; Clear Channel steady; MultiPlan shelves deal

By Sara Rosenberg

New York, Dec. 18 - Momentive Performance Materials Inc.'s term loan B fell in quiet trading on Friday after the company announced that it canceled plans to amend its senior secured credit facility and sell new first-lien notes that would have been used for a paydown.

Also, Clear Channel Communications Inc.'s term loan B and delayed-draw term loan held steady after running up during the previous session on the back of news that the company's bond offering was significantly upsized.

Meanwhile, over in the primary market, MultiPlan Inc. has postponed syndication on its incremental term loan because the company was turned down for expedited regulatory approval of its acquisition of Viant Inc.

Momentive dips on amendment news

Momentive Performance's term loan B took a turn for the worse during the trading session following word that the company terminated its credit facility amendment proposal, according to a trader.

The term loan B was quoted by one trader at 88½ bid, 90½ offered, down from 90½ bid, 92½ offered, and by a second trader at 89 bid, 90 offered.

On Friday morning, Momentive Performance said in an 8-K filed with the Securities and Exchange Commission that it "has chosen not to seek to amend its senior secured credit facility".

Under the pulled amendment proposal, the company was going to extend some term loan commitments to 2015 and some revolver commitments to 2014.

In addition, the amendment was going to reduce the size of the revolver.

Momentive notes canceled

Momentive Performance also revealed in its 8-K filing that it no longer plans to sell $500 million of first-lien senior secured notes.

Proceeds from the notes were going to be used to repay some term loan borrowings and for general corporate purposes.

Completion of the amendment and the notes offering were conditioned on each other, as the amendment was going to give the company permission to issue the notes.

Momentive is an Albany, N.Y.-based specialty materials company, providing high-technology materials products to the silicones, quartz and ceramics markets.

Clear Channel holds firm

Clear Channel's term loan B and delayed-draw term loan were both steady after experiencing a mini rally on Thursday on talk that the company's bond offering was being increased, according to a trader.

The term loan B was quoted by the trader at 83 bid, 84 offered, and the delayed-draw term loan was quoted at 79½ bid, 81½ offered, unchanged on the day.

On Thursday, the term loan B was rose from 81½ bid, 82½ offered and the delayed-draw term loan rose from 79 bid, 81 offered as the company said in a 8-K filing that it was considering upsizing its senior notes offering and using some of the additional proceeds to repay term loans at par.

By evening, sources said that the bond deal was indeed increased, moving to $2.5 billion from $750 million.

In addition to repaying term loans, proceeds from the notes will be loaned to Clear Channel Outdoor Holdings Inc. to repay intercompany debt owed to Clear Channel Communications.

Clear Channel is a San Antonio-based media and entertainment company.

MultiPlan pulls facility

Switching to new deal happenings, MultiPlan removed its $315 million incremental term loan (B1) from market because the acquisition that the bank debt was going to finance hit a regulatory snag, a market source told Prospect News on Friday.

The term loan was being talked at Libor plus 425 basis points with a 2% Libor floor and an original issue discount of 98.

Just a few days ago this official price talk was announced, whereas previously there was unofficial guidance circulating in the Libor plus 400 bps to 425 bps area with a 2.25% Libor floor and a discount of 98.

Goldman Sachs, Bank of America and Credit Suisse were acting as the lead banks on the deal.

MultiPlan acquisition delayed

MultiPlan was getting the incremental term loan in connection with the purchase of Viant, and proceeds were going to be used to refinance term loan debt at Viant.

However, MultiPlan was told that it won't be getting expedited approval from the Department of Justice for the acquisition and, therefore, decided to put financing on the back burner for now, the source explained.

Originally, the company thought that it would be able to close on the transaction before the end of the year.

In addition to the incremental term loan, MultiPlan was also in market with an amendment to its existing credit facility that would have allowed for the acquisition to be completed in return for increased pricing and a consent fee.

Specifically, the amendment was going to raise pricing on the existing credit facility to Libor plus 325 bps from Libor plus 250 bps, and lenders were being offered a 25 bps amendment fee.

MultiPlan is a New York-based provider of health care cost management services. Viant is a Naperville, Ill.-based provider of health care payment services.

TASC closes

TASC Inc.'s buyout by an investor group led by General Atlantic LLC and Kohlberg Kravis Roberts & Co. from Northrop Grumman Corp. was completed, according to a news release.

To help fund the transaction, TASC got a new $690 million senior secured credit facility (Ba2/BB) comprised of a $100 million revolver, a $200 million term loan A and a $390 million term loan B.

Barclays Capital, Deutsche Bank Securities and RBC Capital Markets acted as the lead banks on the deal, with Barclays the left lead. In addition, CPPIB Credit Investments Inc. provided commitments toward the facility as an investor.

TASC pricing

Pricing on TASC's revolver and term loan A is Libor plus 350 bps, and pricing on the term loan B is Libor plus 375 bps, and all tranches include a 2% Libor floor.

The term loan A and the term loan B were sold at an original issue discount of 99 and the revolver was sold at 98.

During syndication, pricing on the revolver and the term loan A was lowered from Libor plus 375 bps, pricing on the term loan B was lowered from Libor plus 400 bps, and the discount on the term loan A and the term loan B was tightened from 981/2.

TASC is a Chantilly, Va.-based provider of advanced systems engineering and technical assistance to the defense, intelligence, federal, state and local markets.

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