Plum Point, Gainey break; Movie Gallery rises; GM up on GMAC buzz; AGY sets talk; Maneely shuts book

By Sara Rosenberg

New York, March 15 - Plum Point Energy Associates LLC's and Gainey Corp.'s new credit facilities freed for trading during Wednesday's session, Movie Gallery Inc.'s term loan sprung higher on amendment hopes and subleasing opportunities and General Motors Corp. rose on more GMAC stories.

In the primary, AGY Holding Corp. price talk has surfaced now that the deal has been launched to investors, and the reception was so favorable that the second-lien portion of the facility is already fully circled and then some.

Also, in the primary, John Maneely Co. shut down the book on its credit facility on Wednesday, ahead of schedule, as the deal was significantly oversubscribed.

Plum Point Energy allocated its credit facility on Wednesday, with the strip of term loan B and synthetic letter-of-credit debt freeing for trading in the par ¾ bid, 101¼ offered context, and the second-lien term loan debt freeing for trading in the 97 bid, 99 offered context, according to traders.

Both the $423 million eight-year term loan B (B1/B) and the $102 million eight-year synthetic letter-of-credit facility (B1/B) are priced with an interest rate of Libor plus 325 basis points. During syndication, the term loan B was downsized from $590 million and the letter-of-credit facility was downsized from $105 million.

The $175 million 81/2-year second-lien term loan is priced with an interest rate of Libor plus 325 basis points plus 200 basis points pay in kind. This tranche, which was added to the capital structure during syndication, was sold to investors at an original issue discount of 971/2.

Plum Point's $750 million credit facility also contains a $50 million five-year revolver (B1/B) with an interest rate of Libor plus 325 basis points and a 50 basis point commitment fee. During syndication, the revolver was downsized from $65 million.

Credit Suisse, Goldman Sachs and Merrill Lynch acted as the lead banks on the deal, with Credit Suisse the left lead.

Proceeds are being used to help finance the construction of the Plum Point Energy Station, a nominal 800 megawatt, coal-fired electric generating plant located near Osceola, Ark.

Chesterfield, Mo.-based Plum Point Energy Associates is a LS Power Group member. St. Louis-based LS Power Group develops, owns and operates large-scale power generation projects.

Gainey frees to trade

Gainey also allocated its credit facility on Wednesday, with its $210 million term loan breaking for trading in the 101½ bid, 102 offered context, according to a trader.

The term loan is priced with an interest rate of Libor plus 275 basis points and carries a step down to Libor plus 250 basis points effective once the company's leverage drops below 23/4x. During syndication, pricing on the loan was reverse flexed from Libor plus 300 basis points with the addition of the step down.

Gainey's $260 million credit facility (B2/BB-) also contains a $50 million revolver.

Wachovia is the lead bank on the deal.

Gainey is a Grand Rapids, Mich., provider of freight transportation.

Movie Gallery shines

Movie Gallery's term loan headed up by about 2 points as investors were hopeful that the company's amendment process would prove successful as Wednesday's consent deadline came and went, and plans to look into subleasing opportunities were announced, according to a trader.

The term loan closed the day quoted at 93¾ bid, 94½ offered, but traded as high as 94½ during market hours, the trader said. On Tuesday, the term loan ended the day quoted at 92 bid, 92½ offered.

Movie Gallery presented investors with an amendment proposal on March 6 that would relax financial covenants, and in return the lenders would get an amendment fee and higher pricing.

The Dothan, Ala.-based operator of video retail stores is not in default under its covenants but needs the relief going forward.

No official word as to whether the amendment passed was available prior to press time.

Also on Wednesday, Movie Gallery announced that it has entered into a management agreement and alliance with Excess Space Retail Services Inc. to explore opportunities for Movie Gallery to sublease retail space at more than 2,200 existing Movie Gallery and Hollywood Video stores.

"In addition to the incremental revenue we expect to realize through subleasing portions of the stores, we look forward to the additional traffic that our retail partners will generate. By taking advantage of our outstanding retail presence, we expect this initiative to improve our operating results and create value for our shareholders," said Keith Cousins, executive vice president and chief development officer, in the release.

GM trades up

GM's revolver gained some ground during market hours as news reports surfaced about a new bid for a majority stake in its financing arm - General Motors Acceptance Corp., according to a trader.

The revolver closed the day quoted at 83¾ bid, 84½ offered, up about half a point from Tuesday's close, the trader said.

According to a Wednesday story in The Wall Street Journal, GM is considering a $12.5 billion to $13 billion bid from a group led by Kohlberg, Kravis & Roberts and some banks for GMAC.

Another player in the mix is Cerberus Capital, which was recently heard to be teaming up with its portfolio firm, Aozora Bank Ltd. of Japan. It was reported that the Japanese bank might put up $1 billion of what is expected to be $11 billion that Cerberus is likely to bid for a 51% stake in GMAC.

And, another Japanese bank, Norinchukin Bank, was reported last week to also be considering joining the Cerberus-led effort to buy control of GMAC. Cerberus has already enlisted Citigroup Alternative Investments, a Citigroup Inc. buyout unit, as a partner.

GM has been trying for months now to sell its stake in GMAC in what has been a very bumpy road. A number of companies thought to be potential buyers, including Wells Fargo Bank and Bank of America, have said they were not interested, and Wachovia Bank was recently reported to have dropped out of a joint bid with Kohlberg, Kravis & Roberts.

GM is a Detroit-based designer, manufacturer, and marketer of cars and light trucks.

Big names jump an eighth

Other secondary movers during the session included Georgia-Pacific Corp., Eastman Kodak Corp. and Resorts International Holdings LLC, which all saw levels move higher by about an eighth of a point on the day, according to a trader.

Georgia-Pacific's term loan B ended the day quoted at par ¾ bid, 101 offered and its term loan C ended the day quoted at 102¼ bid, 102 5/8 offered - stronger on better buying interest with good trading volume throughout the session, the trader said.

Eastman Kodak's bank debt ended the day quoted at 101¼ bid, 101½ offered, with no specific reason seen for the improvement, the trader continued.

And, Resorts International's bank debt ended the day at par 1/8 bid, par 5/8 offered, up as investors are looking to replace the Aztar Corp. (another gaming company) bank debt that will be going away once Pinnacle Entertainment Inc. completes its recently announced acquisition of the company, the trader added.

Georgia-Pacific is an Atlanta-based manufacturer and marketer of tissue, packaging, paper, building products and related chemicals.

Kodak is a Rochester, N.Y.-based digital imaging products, services and solutions company.

Resorts International is an owner and operator of casinos in Atlantic City, N.J., the Chicagoland gaming market and Tunica, Miss.

AGY price talk

Switching to the primary, AGY Holding came out with price talk on its credit facility, with the $30 million five-year revolver (B2) and the $135 million six-year first-lien term loan (B2) talked at Libor plus 275 basis points and the $45 million seven-year second-lien term loan (Caa1) talked at Libor plus 700 basis points, according to a market source.

The deal was launched to investors with a bank meeting on Tuesday that saw "very good attendance," the source said.

And, interest has been so favorable that the second-lien term loan was actually oversubscribed before the bank meeting even took place, the source added.

UBS Investment Bank is the lead bank on the deal that will be used to help fund Kohlberg & Co. LLC's leveraged buyout of AGY.

Under the agreement, Kohlberg affiliates will acquire all of the outstanding shares of AGY for about $268 million in cash, and will assume about $15 million of additional outstanding obligations.

The closing, which is expected to occur by March 31, is subject to approval by the stockholders of AGY and certain other customary conditions.

AGY is an Aiken, S.C., producer of glass fiber yarns.

Maneely shuts book early

John Maneely closed the book on its $290 million seven-year term loan (B2/B) on Wednesday, way ahead of the originally scheduled next week commitment deadline, since the tranche is something like two-and-a-half times oversubscribed, according to a market source.

The term loan is talked at Libor plus 350 basis points, but many investors are expecting a flex downwards to the 325 or even 300 type of range based on the strong market demand.

John Maneely's $490 million credit facility also contains a five-year asset-based revolver (Ba3/BB-) talked at Libor plus 150 basis points.

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

Proceeds will be used to help fund The Carlyle Group's acquisition of Collingswood, N.J.-based John Maneely, parent company of Wheatland Tube Co., a manufacturer of steel pipe and tubular products, and Seminole Tubular Products Co., a manufacturer of plumbing and electrical fittings.

Nacco cuts spread

Nacco Materials Handling Group Inc. reverse flexed pricing on its $225 million term loan B (B2/BB-) to Libor plus 200 basis points from Libor plus 250 basis points, according to a market source.

Citigroup is the left lead bank on the deal.

Proceeds from the term loan B will be used to refinance existing debt, including the company's 10% senior notes.

Nacco is a Portland, Ore.-based forklift truck manufacturer.

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