Advanced Micro firms spread, adds step; TTM cuts pricing; West breaks; VNU, Goodyear, Lear trade up

By Sara Rosenberg

New York, Oct. 23 - Advanced Micro Devices Inc. finalized pricing on its multi-billion dollar term loan at the high end of guidance while adding a step down based on repayments, and TTM Technologies Inc., as anticipated, reverse flexed pricing on its credit facility on Monday.

In secondary happenings, West Corp.'s credit facility freed for trading with the term loan quoted atop par, and VNU NV, The Goodyear Tire & Rubber Co. and Lear Corp. all got a bit of a pop in an overall firm market.

Advanced Micro Devices firmed up pricing on its $2.5 billion seven-year term loan B (Ba3/BB-/BB-) at Libor plus 225 basis points on Monday, the wide end of original guidance at launch of Libor plus 200 to 225 bps, according to a market source.

However, the syndicate did add a step down provision under the agreement, in which pricing can drop to Libor plus 200 bps once the term loan has been reduced by $750 million, the source said.

Morgan Stanley is the lead arranger, bookrunner and administrative agent on the deal.

Proceeds will be used to help fund the acquisition of ATI Technologies Inc. for a combination of $4.2 billion in cash and 57 million shares of common stock.

In addition to term loan B proceeds, the company will use existing cash, cash equivalents and short term investment balances of about $3 billion to fund the acquisition.

Advanced Micro is a Sunnyvale, Calif., provider of microprocessor services for computing, communications and consumer electronics markets. ATI is a Markham, Ont., designer and manufacturer of innovative 3D graphics, PC platform technologies and digital media silicon products.

TTM lowers spreads

TTM Technologies' reduced pricing on both tranches under its $240 million credit facility (B1/BB-) to Libor plus 225 bps from original talk at launch of Libor plus 250 bps, according to a market source.

Speculation over a reverse flex has been floating around the market since last week because players were hearing that the transaction was an absolute blowout, but the official word on spreads didn't come out until Monday's session.

Tranching on the credit facility includes a $200 million six-year term loan B and a $40 million five-year revolver.

UBS is the lead bank on the deal.

Proceeds from the credit facility, along with cash on hand, will be used to fund the acquisition of the Tyco Printed Circuit Group business unit from Tyco International Ltd. for $226 million.

TTM Technologies is a Santa Ana, Calif., supplier of time-critical and technologically advanced printed circuit boards to original equipment manufacturers and electronics manufacturing services companies. Tyco Printed Circuit Group is manufacturer of high-technology printed circuit boards for the military, aerospace and commercial markets.

Flakeboard wraps deal after changes

Flakeboard Co. Ltd. has finally completed its new credit facility after modifications were made to the transaction including carving a second-lien term loan out of the first-lien term loan, increasing pricing on the first-lien term loan and downsizing the revolver, according to a market source.

The first-lien term loan B is now sized at $190 million, down from an original size of $230 million, and pricing was increased to Libor plus 375 bps from original talk at launch of Libor plus 325 to 350 bps, the source said.

To compensate for the first-lien term loan B downsizing, a new $40 million second-lien term loan was added to the capital structure priced at Libor plus 725 bps, the source continued.

Lastly, the company's revolver was cut to $30 million from an original size of $40 million; however, pricing was left in line with initial talk at Libor plus 250 bps, the source added.

RBC Capital Markets is the lead bank on the $260 million deal that was launched with a bank meeting on July 11.

Closing and funding on the transaction took place this past Friday, but details on the revised credit facility structure were not made public until Monday.

Proceeds from the credit facility are being used to fund the acquisition of Weyerhaeuser Co.'s composite panel business, which includes six MDF and particleboard mills.

Flakeboard is a Markham, Ont.-based manufacturer of composite panel products.

West frees to trade

In trading news, West's credit facility hit the secondary with the $2.1 billion seven-year term loan quoted at par 1/8 bid, par 3/8 offered consistently throughout the day, according to a trader.

The term loan is priced at Libor plus 275 bps. During syndication, pricing on the paper was flexed up from original talk at launch of Libor plus 250 bps.

West's $2.35 billion credit facility (Ba3/B+) also includes a $250 million revolver with a 50 bps commitment fee.

Lehman, Deutsche and Bank of America are joint bookrunners on the credit facility, and Lehman and Deutsche are joint lead arrangers. Lehman is also acting as administrative agent, and Deutsche and Bank of America are acting as syndication agents. Wachovia is documentation agent.

Proceeds from the credit facility, along with $1.1 billion in high-yield bonds, will be used to help fund the leveraged buyout of West by an investor group led by Thomas H. Lee Partners and Quadrangle Group LLC.

Under the agreement, all stockholders except Gary West, chairman of the board, and Mary West, vice chairman of the board, will receive $48.75 per share in cash. Gary and Mary West will receive $42.83 per share in cash for about 85% of their current ownership and about 15% of their current ownership will convert into shares of the corporation surviving the merger.

The transaction values the company at $4.1 billion, including debt as of the date of the definitive agreement.

West is an Omaha, Neb., provider of outsourced communication services.

VNU, Goodyear, Lear stronger

As the overall secondary market felt firmer, names like VNU, Goodyear and Lear all traded up, according to a trader, who explained that there was no credit specific news seen behind the positive momentum.

VNU, a Haarlem, the Netherlands-based information and media company, saw its term loan B close the day at par ½ bid, par ¾ offered, up from previous levels of par ¼ bid, par ½ offered, the trader said.

Meanwhile, Goodyear, an Akron, Ohio-based tire company, saw its second-lien term loan close the day at 101 bid, 101½ offered, up from previous levels of par ¾ bid, 101¼ offered, the trader continued.

Lastly, Lear, a Southfield, Mich.-based supplier of automotive interior systems and components, saw its term loan B close the day at 99 7/8 bid, par 3/8 offered, up from previous levels of 99½ bid, par offered, the trader added.

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