Garrett Aviation shifts funds, lowers pricing on first lien; Sunny Delight heads up in trading

By Sara Rosenberg

New York, Aug. 23 - Garrett Aviation Services made some changes to its credit facility, increasing the size, reverse flexing and adding a step down to its first-lien term loan (B1/B+), and decreasing the size of its second-lien term loan (B2/B-). Meanwhile, in secondary happenings Sunny Delight Beverages Co.'s first-lien term loan moved higher from Friday's breaking levels as some trading was seen in the name.

Garrett Aviation's first-lien term loan will now be sized at $157 million compared to initial sizing of $147 million, pricing was reduced to Libor plus 250 basis points from Libor plus 275 basis points and a step down was added to Libor plus 225 basis points if leverage falls below 3.5x, according to a fund manager.

The second-lien term loan will now be sized at $70 million compared to initial sizing of $80 million, to compensate for the first-lien upsizing, the fund manager said, adding that pricing on the tranche remained at Libor plus 525 basis points.

Both the first- and second-lien term loans are oversubscribed, but the first-lien is way oversubscribed while on the second-lien "they were just a little bit over," according to a market source.

Garrett's $287 million credit facility also contains a $60 million revolver (B1/B+) with an interest rate of Libor plus 250 basis points.

Lehman Brothers and Citigroup are joint lead arrangers and joint bookrunners on the credit facility, with Lehman left lead and administrative agent.

Proceeds will be used to help fund The Carlyle Group's acquisition of Garrett from General Electric Co.

Carlyle plans on combining Tempe, Ariz.-based Garrett with one of its existing portfolio companies, Piedmont Hawthorne, to create a general aviation aftermarket service provider offering a more comprehensive range of services, according to a Carlyle news release.

The transaction is expected to close in the third quarter.

Sunny Delight trades up

Sunny Delight's first-lien term loan headed up to 101 bid, 101¼ offered from the par ½ bid, 101 offered level seen on Friday with a "little bit more trading" taking place in Monday's market, according to a trader.

When the deal broke midday Friday and remained at the opening level throughout the remainder of the day some market participants had expressed their belief that the deal would trade higher once more investors became active, which proved true with Monday's performance.

The $170 million first-lien term loan (B1/B+) is priced with an interest rate of Libor plus 425 basis points and contains call protection of 101 in year one.

Sunny Delight is a Cincinnati-based juice drink business.

J.L. French closes

J.L. French Automotive Castings Inc. closed on its $465 million credit facility, according to a market source. The facility consists of a $225 million seven-year term loan B (B3/B) with an interest rate of Libor plus 450 basis points and call protection of 102 in year one and 101 in year two, a $170 million eight-year second-lien term loan (Caa1/CCC+) with an interest rate of Libor plus 700 basis points and call protection of 105 in year one, 103 in year two and 101 in year three, and a $70 million five-year revolver (B3/B) with an interest rate of Libor plus 450 basis points.

Before solidifying a structure, the deal underwent a number of changes, including size and pricing modifications. The term loan B (B3/B) was originally launched with a size of $250 million and was talked in the Libor plus 350 basis points area. Pricing on the term B was increased due to the B3 rating received.

The second-lien term loan was originally launched with a size of $120 million and price talk of Libor plus 700 to 750 basis points. This piece of bank debt had been three times oversubscribed within a few hours of the bank meeting.

And, the revolver was originally launched with a size of $100 million and price talk of Libor plus 350 basis points. As was the case with the term loan B, pricing was increased due to the rating.

Goldman Sachs was the sole lead bank on the Sheboygan, Wis., automotive parts supplier's deal.

Proceeds from the new credit facility, along with proceeds from a preferred equity securities offering, are being used to refinance the company's existing credit facility and to fund the purchase of the company's 11½% senior subordinated notes due 2009 in a tender offer.

Rainbow closes

Rainbow Media Enterprises Inc. closed on its $950 million senior secured credit facility (B+), according to a company news release. The facility consists of a $600 million term loan C with an interest rate of Libor plus 275 basis points and a $350 million revolver with an interest rate of Libor plus 250 basis points.

JPMorgan and Bank of America were the lead banks on the deal, with JPMorgan listed on the left.

Proceeds from the term loan and $800 million of high-yield bonds were used to repay about $705 million of outstanding bank debt at Rainbow Media Holdings. The remaining proceeds of about $661 million will be invested in Rainbow Media Enterprises' subsidiaries, including primarily Rainbow DBS.

Rainbow Media is a Jericho, N.Y., cable programming company.

Concentra closes

Concentra Operating Corp. closed on its repricing amendment that reduced the interest rate on the term loan B to Libor plus 250 basis points and extended the maturity by one year to 2010, according to a company news release. JPMorgan was the lead bank on the deal.

At June 30, the total amount outstanding under the term loan B was $401.475 million.

Concentra Operating, a wholly owned subsidiary of Concentra Inc., is an Addison, Texas, provider of services designed to contain healthcare and disability costs.

© 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.