Oshkosh Truck upsizes; Metrologic sets talk; Freescale, Infonxx, Dura break for trading

By Sara Rosenberg

New York, Nov. 28 - Oshkosh Truck Corp. upsized its credit facility through increases to its pro rata tranches, and Metrologic Instruments Inc. came out with price talk on its credit facility ahead of Wednesday's launch as ratings on the deal emerged.

On the secondary front, Freescale Semiconductor Inc., Infonxx Inc. and Dura Automotive Systems Inc. freed for trading, with their institutional bank debt all seen quoted in the lower par region by the end of the day.

Oshkosh Truck increased the overall size of its credit facility by $150 million by upsizing its revolver and term loan A tranches so as to provide additional working capital, according to a market source.

Under the changes, the five-year revolver is now sized at $550 million, up from an original size of $500 million, and the five-year term loan A is now sized at $500 million, up from an original size of $400 million, the source said.

Pricing on both the revolver and term loan A remained unchanged at Libor plus 175 basis points, the source continued.

Oshkosh's now $3.65 billion (up from $3.5 billion) senior credit facility (Ba3/BB) also contains a $2.6 billion seven-year term loan B that is priced at Libor plus 200 bps.

Bank of America and JPMorgan are the lead banks on the deal that will be used to fund the acquisition of JLG Industries, Inc. for $28.00 per share. Total consideration, including transaction costs and assumed debt, is $3.2 billion in cash on a fully diluted basis.

The company expects to pay down $300 million or more annually by fiscal 2008, bringing the debt to EBITDA ratio down to around 3 times by Sept. 30, 2008 from the upper-4s at closing of this transaction.

Despite the increase to the credit facility size, leverage will remain at the previously outlined level because the company increased EBITDA, the source added.

Oshkosh Truck is an Oshkosh, Wis., designer, manufacturer and marketer of specialty commercial, fire and emergency and military vehicles and bodies. JLG is a McConnellsburg, Pa., manufacturer of access equipment, including aerial work platforms and telehandlers.

Metrologic floats talk

Metrologic announced opening price talk levels on its $235 million first- and second-lien senior secured credit facility, which will be launched with a bank meeting on Wednesday, after ratings on the transaction surfaced, according to a market source.

The $35 million five-year revolver (B1/B+) and the $125 million seven-year first-lien term loan B (B1/B+) are being talked at Libor plus 300 bps, and the $75 million eight-year second-lien term loan (Caa1/B-) is being talked at Libor plus 700 bps, the source said.

The revolver will carry a 50 bps undrawn fee.

The official price talk is not unexpected as various filings with the Securities and Exchange Commission had revealed spread projections on the revolver and first-lien term loan B of Libor plus 300 bps if the deal is rated B2/B or higher and Libor plus 350 bps if the deal is rated lower than B2/B, and on the second-lien of Libor plus 700 bps.

Morgan Stanley is the lead bank on the deal that will be used to help fund the leveraged buyout of Metrologic by an investor group led by Francisco Partners, C. Harry Knowles, founder and chief executive officer of Metrologic, and Elliott Associates, LP for $18.50 in cash for each share of Metrologic common stock.

Equity financing for the buyout is $190.6 million, consisting of $128 million from Francisco Partners Investor and $62.6 million in rollover equity financing.

Metrologic is a Blackwood, N.J., supplier for data capture and collection hardware, optical products and image processing software.

Tata Coffee wraps syndication

Tata Coffee Ltd. has completed syndication of its $173 million credit facility, with tranches reaching slight oversubscription as the transaction was only presented to a relatively small group, according to a market source.

The facility consists of a $15 million revolver priced at Libor plus 275 bps, a $105 million first-lien term loan priced at Libor plus 275 bps and a $53 million second-lien term loan priced at Libor plus 650 bps.

Call premiums on the second lien are 102 in year one and 101 in year two, the source added.

No changes were made to the facility during the syndication process.

Rabo Bank is the lead bank on the India-based coffee company's deal that will be used to help fund the acquisition of Montvale, N.J.-based Eight O'Clock Coffee Co. from Gryphon Investors for a total acquisition price of $220 million.

Allocations went out to investors on Tuesday, and the deal is expected to free for trading on Wednesday, the source added.

Freescale frees to trade

Switching to secondary news, Freescale Semiconductor's credit facility broke for trading, with the $3.5 billion seven-year term loan B closing the session at par ¼ bid, par ½ offered, according to one trader, and at par 3/8 bid, par 5/8 offered, according to a second trader.

The first trader said that the loan did open at par 3/8 bid, par 5/8 offered, traded very actively after the break and then settled in at the closing levels of ¼ to 1/2.

The term loan B is priced at Libor plus 200 bps. During syndication, pricing on the tranche was reverse flexed from original talk at launch of Libor plus 225 bps.

Freescale's $4.25 billion senior secured covenant-light credit facility (Baa3/BB) also includes a $750 million six-year revolver priced at Libor plus 225 bps.

Citigroup, Credit Suisse, JPMorgan, Lehman Brothers and UBS are joint bookrunners on the deal, and Citigroup and Credit Suisse are joint lead arrangers. Citigroup is administrative agent, Credit Suisse is syndication agent and JPMorgan is documentation agent.

Proceeds from the credit facility will be used to help fund the leveraged buyout of Freescale by a private equity consortium, which is led by The Blackstone Group and includes The Carlyle Group, Permira Funds and Texas Pacific Group, for $40.00 per share in cash. The total equity value of the transaction is $17.6 billion.

Other LBO financing will come from $5.95 billion of high-yield bonds and equity.

Leverage through the secured debt is 1.6 times, and total leverage is 4.9 times.

Freescale is an Austin, Texas, designer and manufacturer of embedded semiconductors for the automotive, consumer, industrial, networking and wireless markets.

Infonxx breaks

Infonxx's credit facility was another deal that hit the secondary market on Tuesday, with both its $275 million first-lien term loan B (B1/B) and its $125 million second-lien term loan (Caa1/CCC+) quoted at par ¼ bid, par ½ offered, according to a trader.

The first-lien term loan B is priced at Libor plus 325 bps. Originally it was heard that the tranche was being guided in the area of Libor plus 300 to 400 bps, then at launch, price talk was narrowed down to Libor plus 300 bps, and finally during syndication, pricing was increased to Libor plus 325 bps.

The second-lien term loan is priced at Libor plus 600 bps. Originally it was heard that the tranche was being guided in the area of Libor plus 600 to 700 bps, then at launch, price talk was narrowed down to Libor plus 600 bps, where it ended up.

The $600 million deal also includes an existing $200 million revolver (B1/B) that is being amended to allow for the additional debt and increase pricing.

Bank of America is the lead bank on the facility that will be used to repay existing bank debt and for acquisition financing.

Infonxx is a Bethlehem, Pa., independent directory assistance supplier.

Dura trades atop par

Also breaking for trading was Dura Automotive's debtor-in-possession financing facility, with the $150 million term loan B quoted at par bid, par ¼ offered, according to a market source.

The term loan B is priced at Libor plus 325 bps. During syndication, pricing on the tranche firmed up at the midpoint of original guidance of Libor plus 300 to 350 bps.

Dura's $300 million DIP facility also includes a $20 million synthetic letter-of-credit facility priced at Libor plus 325 bps and a $130 million asset-based revolver priced at Libor plus 175 bps. Price talk on the synthetic letter-of-credit facility had also originally been Libor plus 300 to 350 bps.

Goldman Sachs, GE Capital and Barclays are the lead banks on the deal.

Dura has already obtained final court approval for the DIP facility.

Proceeds will be used to fund normal business operations and continue the company's operational restructuring program initiated in February 2006.

Dura is a Rochester Hills, Mich.-based automotive parts maker.

Service closes

Service Corp. closed on its new $450 million five-year senior credit facility consisting of a $300 million revolver and a $150 million unsecured term loan, according to a company news release.

During syndication, pricing on the term loan was reverse flexed from original talk at launch of Libor plus 250 bps.

JPMorgan acted as the lead bank on the deal that was used to help fund the acquisition of Alderwoods Group, Inc., to purchase Service's 7.7% notes and to purchase Alderwoods' 7.75% notes.

Houston-based Service is a leading provider of funeral and cemetery services. Cincinnati-based Alderwoods is the second-largest operator of funeral homes and cemeteries.

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