Burger King weakens with refinancing; DaVita gains; United Central, Nuveen reveal talk

By Sara Rosenberg

New York, Sept. 5 - Burger King Corp.'s term loan B softened in trading on Wednesday as plans were announced for a refinancing of the debt and DaVita Inc.'s term loan B-2 was a little stronger.

Moving to the primary, United Central Industrial Supply Co. LLC (United Distribution Group) and Nuveen Investments released price talk as both transaction were launched to investors during the session.

Additionally, timing on CNO Financial Group Inc.'s and Deltek Inc.'s credit facilities emerged, and Six3 Systems Inc., Ollie's Bargain Outlet and Alkermes Inc. revealed plans for new deals.

Burger King dips

Burger King's term loan B was a bit weaker in the secondary market on Wednesday as news came out that the company will be repaying about $1.728 billion of the debt, according to sources.

Specifically, the B loan was quoted by sources at par bid, par 3/8 offered, down from par ¼ bid, par ½ offered.

Funds for the refinancing will come from a term loan A due 2017 and a term loan B due 2019, and the company also plans on getting a revolver due Oct. 19, 2015. Tranche sizes are not yet available.

A bank meeting to launch the credit facility has been set for 10 a.m. ET on Friday in New York.

J.P. Morgan Securities LLC, Barclays and Bank of America Merrill Lynch are the lead banks on the deal.

Burger King is a Miami-based fast food hamburger chain.

DaVita rises

In more trading news, DaVita's term loan B-2 headed up to 99¾ bid, par ¼ offered, from 99 5/8 bid, par 1/8 offered, according to a trader.

On Wednesday, new reports surfaced saying that William Blair & Co. analyst made favorable remarks about the company's decision to purchase HealthCare Partners for about $4.42 billion.

DaVita is a Denver-based provider of kidney care services for those diagnosed with chronic kidney disease. HealthCare Partners is a Torrance, Calif.-based operator of medical groups and physician networks.

United Central guidance

Switching to the new deal front, United Central Industrial Supply held a bank meeting on Wednesday to kick off syndication on its $435 million senior secured covenant-light credit facility, and with the launch, price talk was announced, according to a market source.

The $50 million five-year revolver (B2) and $285 million six-year term loan (B2) are both being talked at Libor plus 550 bps, and the $100 million 61/2-year second-lien term loan (Caa2) is talked at Libor plus 950 bps. Both term loans have a 1.25% floor and the first-lien loan is offered with an original issue discount of 981/2, while the second-lien is offered at a discount of 971/2, the source said.

There is 101 soft call protection for one year on the first-lien term loan, and hard call protection of 103 in year one, 102 in year two and 101 in year three on the second-lien loan, the source continued.

Lead banks, Barclays, Goldman Sachs & Co. and Nomura, are seeking commitments by 5 p.m. ET on Sept. 21 for the deal that will help fund the acquisition of GHX Holdings from CapStreet Group LLC.

Excluding synergies, senior secured leverage is 3.9 times and total leverage is 5.25 times.

United Central is a Bristol, Tenn.-based distributor of industrial supplies and services. GHX is a Houston-based distributor of industrial gaskets, hoses and related fluid sealing products

Nuveen talk emerges

Nuveen Investments launched its $435 million term loan due May 2017 with a conference call in the afternoon, and talk surfaced at Libor plus 550 bps with no Libor floor, sources said.

The term loan has 101 soft call protection through February 2013 and an original issue discount of 99 to 99½ on new money. Existing lenders are being offered the term loan at par for rollover commitments, sources remarked.

Pricing on the term loan matches the existing extended term loan, which was quoted at par 1/8 bid, par 5/8 offered after the news came out about the new deal, a trader remarked. Prior to the news, the extended term loan was seen at par ¼ bid, par ¾ offered.

Bank of America Merrill Lynch, Deutsche Bank Securities Inc., Citigroup Global Markets Inc., RBC Capital Markets LLC, Morgan Stanley Senior Funding Inc., UBS Securities LLC and Wells Fargo Securities LLC are leading the deal that will be used to refinance existing non-extended debt.

Commitments are due on Sept. 11.

Nuveen is a Chicago-based provider of investment services to institutions as well as individual investors.

CNO sets meeting

CNO Financial revealed timing for its $700 million credit facility (Ba3/B+) - with the bank meeting scheduled for 10 a.m. ET on Friday, according to a market source.

Goldman Sachs & Co. and J.P. Morgan Securities LLC are leading the deal that consists of a $50 million three-year unfunded revolver, a $250 million four-year term loan and a $400 million six-year term loan.

Proceeds, along with $250 million of new senior secured notes due 2020 and cash on hand, will repay all $224 million of the company's existing bank debt, repurchase up to $275 million of 9% senior secured notes due 2018 for about $323 million and repurchase about $200 million of 7% convertible senior debentures due 2016 from Paulson & Co. for around $334 million.

Closing is expected in late September.

CNO is a Carmel, Ind.-based insurance company.

Deltek timing

Deltek will be holding a bank meeting on Sept. 20 to launch its $680 million senior secured credit facility that was previously just labeled as September business, according to a market source.

The deal consists of a $30 million revolver, a $425 million first-lien term loan and a $225 million second-lien term loan.

Jefferies Finance LLC and RBC Capital Markets are leading the facility that will be used to help fund the purchase of the company by Thoma Bravo LLC for $13 per share, or about $1.1 billion.

Closing is expected in the fourth quarter, subject to customary conditions and regulatory approvals.

Deltek is a Herndon, Va.-based provider of enterprise software and information for professional services firms and government contractors.

Six3 readies deal

Six3 Systems joined this week's calendar too, setting a bank meeting for Thursday afternoon to launch a $310 million credit facility that consists of a $50 million five-year revolver and a $260 million seven-year term loan B, according to market sources.

Goldman Sachs & Co., J.P. Morgan Securities LLC, Bank of America Merrill Lynch and RBS Citizens are leading the financing.

Proceeds will be used to repay existing debt and preferred equity, and the deal will result in leverage of 45 times, sources continued.

Six3 is a McLean, Va.-based provider of strategic and differentiated services to support the missions of customers in the U.S. national security and defense intelligence communities.

Ollie's plans loan

Meanwhile, Ollie's Bargain Outlet is scheduled to hold a bank meeting on Sept. 12 to launch a $300 million credit facility that is being led by Jefferies Finance LLC, M&T Bank and KeyBanc Capital Markets, according to a market source.

The facility consists of a $75 million ABL revolver, of which $25 million will be drawn at closing, and a $225 million term loan, the source said.

Proceeds, along with around $465 million in new and rollover equity, will be used to fund the roughly $700 million acquisition of the company by CCMP Capital Advisors LLC from KarpReilly LLC.

Total leverage will in the low-to-mid 4 times context, the source added.

Ollie's Bargain Outlet is a Harrisburg, Pa.-based retailer of closeouts, excess inventory and salvage merchandise.

Alkermes coming soon

Also, Alkermes will hold a bank meeting at 2 p.m. ET on Monday in New York to launch a $375 million senior secured term loan that will be used to refinance existing credit facility debt, according to a market source.

Morgan Stanley Senior Funding Inc, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC are the lead banks on the deal.

Alkermes is a Dublin, Ireland-based biopharmaceutical company.

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