Rural/Metro attracts early commitments; UPC reaches oversubscription as orders continue to flood in

By Sara Rosenberg

New York, Feb. 11 - New deals appear to be flying off the shelf as Rural/Metro Corp.'s $155 million senior secured credit facility (B2/B) has already gotten in a bunch of orders even though the launch only happened on Friday, and UPC Financing Partnership's $600 million term loan H was already oversubscribed just one day after its New York launch.

Rural/Metro's facility consists of a $120 million term loan B due 2011, a $15 million institutional letter-of-credit facility due 2011 and a $20 million revolver due 2010. All tranches are talked at Libor plus 350 basis points.

"It drew a lot of early commitments," a market source remarked. "The bank meeting went fine."

Citigroup and JPMorgan are the lead banks on the deal, with Citigroup the left lead.

Proceeds from the facility will be used to help finance the company's tender offer and consent solicitation for its $150 million 7 7/8% senior notes due 2008 and to repay about $153 million of outstanding revolver debt.

The borrower under the facility will be a newly formed wholly owned subsidiary of Rural/Metro. This subsidiary will also offer $140 million of senior subordinated notes due 2015 to finance the tender offer. And, Rural/Metro will offer about $50 million in gross proceeds of senior discount notes due 2016.

Rural/Metro is a Scottsdale, Ariz., provider of emergency and non-emergency medical transportation, fire protection and other safety services.

UPC oversubscribed

UPC Financing Partnership's $600 million term loan H was oversubscribed by Friday afternoon, with more than $800 million in the book, according to a market source - no surprise being that within hours of launching in New York on Thursday there was already about $400 million in the book.

The term loan H, which is being offered to investors at par and contains soft call protection of 101 for year one, is talked at Libor plus 300 basis points with a step down to Libor plus 275 basis points when leverage falls below 4x.

The deal launched in Los Angeles on Tuesday but the meeting was on a much smaller scale with about 10 to 15 accounts attending in person and no dial-in number for those who couldn't be there.

About two or three accounts had already put in orders prior to the Los Angeles meeting.

UPC Financing is a subsidiary of Denver-based broadband network business UnitedGlobalCom Inc.

In addition, UPC Distribution Holdings BV, the wholly owned subsidiary of UnitedGlobalCom that holds and operates broadband network business in 11 European countries, is working on getting a new €850 million term loan G talked at Libor plus 250 basis points. The euro tranche does not contain a call protection provision but is being offered with upfront fees of 75 basis points for commitments of up to $35 million, 100 basis points for commitments of $36 million to $50 million in size, 125 basis points for commitment of $51 million to $70 million in size and 150 basis points for any commitments larger than $70 million.

Proceeds from the two term loans will be used to refinance the company's existing term loan B and the existing term loan C, which carry an interest rate of Libor plus 550 basis points.

The euro term loan G was launched in January to new and existing banks. However rollover commitments from lenders who currently hold positions in the company's euro-denominated term loan B paper that is being refinanced was expected to, and in fact did, account for basically all of the also oversubscribed deal.

Bank of America, Royal Bank of Scotland and ABN Amro are the lead banks on both term loans.

UPC's $525 million term loan F that was recently obtained via TD Securities Inc. and BNP Paribas will remain in place and keep its current pricing of Libor plus 350 basis points, for now. However, after June, the pricing can step down to Libor plus 300 basis points if leverage gets below 4x.

Las Vegas Sands allocating soon

The Las Vegas Sands Inc./Venetian Casino Resort LLC $1.57 billion amended and restated senior secured credit facility (B1/BB-) is expected to allocate early in the Feb. 14 week, and pricing is anticipated to stay at opening price talk levels of Libor plus 175 basis points on all tranches, according to a market source.

The facility consists of a $1.17 billion term loan B due June 15, 2011, of which $105 million is delayed draw until Aug. 20 with a 75 basis point commitment fee, and a $400 million revolver due March 2010 with a 50 basis point commitment fee.

The deal, which launched on Feb. 2, was oversubscribed many times very quickly after the bank meeting.

Essentially through this deal, the company is increasing its term loan by $400 million, expanding its revolver by $275 million, extending the revolver maturity from Aug. 20, 2009, lowering its interest costs and revising some of its covenants to provide greater operational flexibility.

Currently, the company's existing term loan B and revolver carry an interest rate of Libor plus 250 basis points; so, this new deal as launched would lower rates by 75 basis points across the board.

Goldman Sachs and The Bank of Nova Scotia are the lead banks on the deal, with Goldman the left lead.

The company's existing $115 million delayed-draw term loan A is expected to be terminated in connection with the amendment and restatement.

Proceeds from the additional term loan debt, along with proceeds from a $250 million senior notes offering, will be used to retire the outstanding 11% mortgage notes due 2010 of Las Vegas Sands Inc. and Venetian Casino Resort.

Proceeds from the remainder of the amended and restated facility will be used to refinance borrowings under the existing senior secured credit facility, to finance a portion of the design, development, construction and pre-opening costs of the Palazzo Casino Resort, and for general corporate purposes.

Closing on the facility is expected to occur this month.

Las Vegas Sands is a Las Vegas hotel, gaming, resort and exhibition/convention company.

Hexcel sets pricing

Hexcel Corp. revealed pricing of Libor plus 200 basis points on both its $125 million five-year revolver, which contains a pricing grid, and its $225 million seven-year term loan B, which does not contain a pricing grid, in a term sheet recently posted to Intralinks, according to a market source.

Deutsche Bank and Bank of America are the lead banks on the deal.

The $350 million senior secured credit facility (B2/B+) is being obtained in connection with the company's tender offer for its $125 million 9.875% senior secured notes due 2008. The tender offer will expire on Feb. 28.

Hexcel is a Stamford, Conn., structural materials company.

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