La Paloma breaks for trading; M/C repriced term loan trades atop par; Vanguard Car Rental pulls deal

By Sara Rosenberg

New York, Aug. 17 - La Paloma Generating Co. LLC's credit facility freed up for trading on Wednesday, with the first-lien institutional debt quoted atop 101 and the second-lien debt quoted in the 102s. And, M/C Communications LLC's repriced and upsized term loan allocated as well, with the paper trading around in the par context.

Meanwhile, in the primary market, Vanguard Car Rental USA Inc. has decided to postpone syndication of its credit facility, less than a week after the syndicate made a round of changes to the deal.

La Paloma's $525 million credit facility freed up for trading during market hours Wednesday, with the $305 million of first-lien institutional debt quoted at 101½ bid, 101¾ offered by the close and the $155 million of second-lien term loan debt quoted at 102 bid, 102½ offered, according to a trader.

The first-lien bank debt was quoted earlier in the day at 101 3/8 bid, 101 5/8 offered before closing out the session at the higher levels, the trader added.

The first-lien institutional debt (Ba3/BB-), which is being traded as a strip, consists of a $40 million pre-funded letter-of-credit facility, a $244 million first-lien term loan and a $21 million delayed-draw first-lien term loan. All of these first-lien institutional tranches are priced at Libor plus 175 basis points with 101 soft call protection for one year. Pricing on these tranches was reverse flexed from Libor plus 225 basis points, with the addition of the soft call, during syndication.

The second-lien term loan (B2/B) is priced with an interest rate of Libor plus 350 basis points and contains call protection of 102 in year one and 101 in year two. This tranche was reverse flexed from Libor plus 400 basis points during syndication and was downsized from $171 million.

La Paloma's credit facility also contains a $65 million revolver (Ba3/BB-) with an interest rate of Libor plus 225 basis points that was left unchanged throughout syndication.

Morgan Stanley and WestLB served as joint lead arrangers, bookrunners and co-syndication agents on the deal that actually closed on Tuesday.

Proceeds were used to help fund Complete Energy Holdings LLC's acquisition of La Paloma, a gas-fired, four-unit combined-cycle facility located in Kern County, Calif., for $580 million.

M/C Communications mid-par

M/C Communications' approximately $181 million term loan allocated on Wednesday, with the repriced paper quoted at par ¼ bid, par ¾ offered by day's end, according to a trader.

The term loan, which includes a new $35 million add-on, is now priced at Libor plus 250 basis points, down from previous pricing of Libor plus 450 basis points, and contains 101 soft call protection for one year.

Proceeds from the incremental term loan debt will be used to prepay junior debt.

Lehman acted as the lead bank on the deal for the Boston-based producer of medical conferences.

Delphi stronger

In general, the auto sector was stronger on Wednesday, with one example being Delphi Corp. as its bank debt traded up by about half a point.

Delphi's revolver was quoted at 95¼ bid, 95¾ offered and its term loan was quoted at 102¾ bid, 103½ offered, a trader said.

Delphi is a Troy, Mich., supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology to vehicle manufacturers.

Vanguard shelved

Vanguard Car Rental "postponed" its $800 million credit facility that has been in syndication since the end of July and had just recently undergone a series of changes that included a downsizing, an increase in spreads and the addition of a second-lien tranche, according to market sources.

No other information on why the deal was tabled, or when and if it might resurface was available, sources added.

Last week, the syndicate downsized the proposed first-lien term loan by $200 million to $525 million and flexed price talk higher to the Libor plus 500 basis points area from Libor plus 450 basis points.

Furthermore, a $100 million second-lien term loan was added to the credit structure with price talk of Libor plus 750 basis points.

The credit facility also contained a $175 million revolver.

Lehman, Goldman Sachs and Citigroup were acting as the bookrunners on the deal, with Lehman the left lead, and Credit Suisse First Boston and Wachovia were involved as well.

Proceeds from the credit facility were going to be used to refinance existing debt as well as to fund a distribution to shareholders. The downsizing in the credit facility would have resulted in a $100 million reduction in the planned dividend payment.

Vanguard is the Tulsa, Okla., owner and operator of Alamo Rent A Car and National Car Rental.

Acco closes

Acco Brands Corp. closed on its new $750 million credit facility (BB-) consisting of a $150 million five-year revolver with an interest rate of Libor plus 200 basis points, a $200 million five-year term loan A with an interest rate of Libor plus 200 basis points and a $400 million seven-year term loan B with an interest rate of Libor plus 175 basis points.

Originally, the term loan B was launched with price talk of Libor plus 200 basis points but was reverse flexed during syndication.

Pricing on the revolver and term loan A were left unchanged throughout syndication.

Citigroup and ABN Amro acted as the lead banks on the deal, with Citigroup the left lead.

Proceeds from the term loans were used to help fund Fortune Brands Inc.'s spinoff of Acco World Corp. and merger of Acco with General Binding Corp. to form a new entity called Acco Brands - a transaction that was completed Wednesday morning.

Revolver borrowings will be available for general corporate purposes.

Acco is an Illinois-based supplier of branded office products.

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