SRA breaks; Nebraska Book flexes; Lion Copolymer, Inmar, Clement, Ardent Health ready launches

By Sara Rosenberg

New York, July 13 - SRA International Inc.'s credit facility allocated and freed up for trading during Wednesday's market hours, with the term loan seen trading higher than its original issue discount price.

Over in the primary, Nebraska Book Co. Inc. made a number of changes to its debtor-in-possession term loan B due to strong demand, including lowering pricing and setting the original issue discount at the tight end of talk.

Additionally, Lion Copolymer LLC, Inmar Inc. and Clement Pappas and Co. Inc. emerged with plans to bring new credit facilities to market, and Ardent Health Services LLC will be hitting up existing lenders for a term loan B add-on.

SRA begins trading

SRA International's credit facility made its way into the secondary market on Wednesday, with the $875 million seven-year term loan quoted at 96 bid, 96½ offered on the open and then it moved up to 96¼ bid, 96¾ offered, according to a trader.

Pricing on the term loan is Libor plus 525 basis points with a 1.25% Libor floor, and it was sold at an original issue discount of 95. There is 101 soft call protection for one year.

During syndication, pricing was increased from talk of Libor plus 425 bps to 450 bps, the Libor floor was cut from 1.5% and the discount widened from 99.

The company's $975 million senior secured credit facility (B1/B) also includes a $100 million five-year revolver.

Citigroup Global Markets Inc., Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. are the joint lead arrangers and bookrunners on the deal.

SRA being acquired

Proceeds from SRA International's credit facility will be used to help fund the company's buyout by Providence Equity Partners for $31.25 in cash per share for a total value of $1.88 billion.

Other funds for the transaction will come from $400 million of senior notes, which are backed by a commitment for a senior unsecured interim loan, equity and shares of SRA common stock contributed by the rollover investor.

Bridge loan pricing is Libor plus 725 bps with a 1.25% Libor floor, increasing to a specified cap.

Closing on the transaction is expected during the first quarter of fiscal year 2012, which begins on July 1, subject to shareholder approval and regulatory approvals.

SRA is a Fairfax, Va.-based provider of technology and strategic consulting services to government organizations and commercial clients.

DEI holds firm

DEI Holdings Inc.'s $130 million six-year first-lien term loan was quoted at 99½ bid, par offered on Wednesday after breaking at those levels in the previous session, a trader said, adding that there has been little to no activity in the name.

Pricing on the loan, as well as on a $30 million revolver and a C$15 million six-year first-lien term loan, is Libor plus 550 bps with a 1.5% Libor floor, and the tranches were sold at an original issue discount of 99. There is 101 soft call protection for one year on the first-lien term loans.

Pricing on the first-lien debt was flexed up from Libor plus 450 bps during syndication.

The company's roughly $220 million senior secured credit facility also includes a $46.8 million 61/2-year second-lien term loan priced at Libor plus 850 bps with a 1.5% Libor floor. This tranche was added to the capital structure when the total first-lien term loan amount was reduced from $175 million.

DEI backing acquisition

Proceeds from DEI's credit facility, led by GE Capital Markets and Oppenheimer & Co. Inc., are being used to help fund the already completed buyout of the company by Charlesbank Capital Partners for $4.46 per share in cash. The total enterprise value of the transaction, including debt assumption, is roughly $305 million.

At first, Charlesbank was offering to buy the company for $3.79 to $3.81 per share in cash for a total enterprise value of about $285 million, but this offer was later increased.

Other funds came from $121 million of equity, increased from $95.8 million.

First-lien leverage is 3.2 times and leverage through the second-lien loan is 4.2 times.

DEI is a Vista, Calif.-based designer and marketer of home theater loudspeakers and vehicle security and remote start systems, and a supplier of mobile audio.

Nebraska Book tweaks deal

Moving to the primary, Nebraska Book lowered pricing on its $125 million term loan B to Libor plus 600 bps from Libor plus 700 bps and firmed the original issue discount at 99, the low end of the 98½ to 99 talk, according to a market source. The 1.25% Libor floor was left unchanged.

The company's $200 million one-year debtor-in-possession financing facility also includes a $75 million ABL revolver priced at Libor plus 350 bps with no Libor floor

J.P. Morgan Securities LLC is the lead bank on the deal that will be used for general corporate purposes during the company's Chapter 11 process.

Through the bankruptcy proceedings, the company is restructuring $450 million of outstanding loans and bonds, including the elimination of up to $77 million of debt.

Nebraska Book is a Lincoln, Neb.-based retailer and wholesaler of college textbooks.

Lion Copolymer readies loan

Lion Copolymer has set a bank meeting for Thursday to launch a proposed $400 million credit facility that will be used to refinance existing debt and fund a dividend, according to a market source.

The facility consists of a $50 million five-year revolver and a $350 million six-year term loan B, the source said.

HSBC Securities (USA) Inc. and Wells Fargo Securities LLC are the lead banks on the deal.

Lion Copolymer is a Baton Rouge, La.-based manufacturer of synthetic rubber.

Inmar sets meeting

Inmar is holding a bank meeting on Thursday morning to launch a proposed $240 million senior secured credit facility (B+) that consists of a $210 million term loan B and a $30 million revolver, according to a market source.

Wells Fargo Securities LLC and J.P. Morgan Securities LLC are the lead banks on the deal that will be used to refinance existing debt and fund a dividend.

Inmar is a Winston-Salem, N.C.-based connecter of trading partners through consulting, software services and operations.

Clement Pappas coming soon

Clement Pappas has scheduled a bank meeting for July 20 to launch a proposed $280 million credit facility that is being led by Jefferies & Co. and BMO Capital Markets Corp., according to a market source.

The facility consists of a $50 million five-year ABL revolver and a $230 million six-year term loan B, the source said. Price talk has not yet been released.

Proceeds will be used to help fund the acquisition of the company by Lassonde Industries Inc. for $390 million.

Closing is expected in August, subject to customary conditions, including regulatory approvals.

Clement Pappas leverage

Pro forma for the transaction, Clement Pappas' senior leverage is expected at around 4.25 times, the source remarked.

Upon announcing the acquisition, Lassonde Industries said that it expects to draw $253 million under the credit facility, invest about $106 million and get the remaining $44 million from members of the Pappas and Lassonde families.

Clement Pappas is a Carneys Point, N.J.-based producer of store brand ready-to-drink fruit juices, drinks and sauces. Lassonde Industries is a Quebec-based developer, manufacturer and marketer of fruit and vegetable juices and drinks as well as specialty food products.

Ardent plans add-on

Ardent Health Services is holding a conference call on Thursday to launch a $200 million term loan B add-on due September 2015 to existing lenders that is being led by Bank of America Merrill Lynch, Barclays Capital Inc. and GE Capital Markets, according to a market source.

Proceeds from the add-on will be used to fund previously announced acquisitions of hospitals, including the purchase of SouthCrest Hospital in Tulsa, Okla., and Claremore Regional Hospital in Claremore, Okla., from Community Health Systems Inc.

In early 2010, the company completed a dividend recapitalization for which it obtained its existing term loan B at a size of $325 million and at pricing of Libor plus 500 bps with a 1.5% Libor floor. The loan was sold at a discount of 98 and included call protection of 102 in year one and 101 in year two.

Ardent Health Services is a Nashville, Tenn.-based operator of acute care hospitals and specialty care facilities.

Primedia buyout closes

Primedia Inc.'s acquisition by TPG Capital for $7.10 per share in cash was completed on Wednesday, according to a news release. The transaction enterprise value is about $525 million.

To help fund the buyout, Primedia got a new $325 million credit facility (B), consisting of a $40 million five-year revolver and a $280 million 61/2-year term loan B, both priced at Libor plus 600 bps. The revolver has no floor and an undrawn fee of 62.5 bps, and the B has a 1.5% Libor floor, was sold at an original issue discount of 96 and has soft call protection of 102 in year one and 101 in year two.

During syndication, the term B was upsized from $275 million and pricing on the deal was flexed from Libor plus 500 bps. Also, regarding the B loan, the discount moved from talk of 98½ to 99, which was why the deal was upsized, the call protection was added and the maturity was shortened from seven years.

Bank of America Merrill Lynch, Barclays Capital Inc., UBS Securities LLC and RBC Capital Markets LLC led the deal for the Norcross, Ga.-based provider of real estate guides.

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