Woodstream firms spreads; Vertrue sets first-, second-lien OIDs; LCDX bounces around

By Sara Rosenberg

New York, Aug. 20 - Woodstream Corp. finalized pricing on its credit facility at the tight end of revised guidance and Vertrue Inc. firmed up the original issue discounts on its credit facility.

In trading, LCDX opened stronger and climbed from there, but settled back in at unchanged levels by the end of the day.

Woodstream firmed up pricing on its $208.75 million credit facility at the low end of modified talk, with the deal successfully syndicated and even slightly oversubscribed, according to a market source.

The $65 million six-year revolver and the $143.75 million seven-year term loan both ended up priced at Libor plus 350 basis points, the source said.

At launch, both tranches had been talked at Libor plus 275 bps to 300 bps, and then guidance was later revised to Libor plus 350 bps to 400 bps before settling in at the tight end.

The term loan was sold to investors with an original issue discount of 99, a feature that was added to the paper during the syndication process.

In addition, the term loan was downsized from $200 million earlier on in syndication.

GE Capital is the lead bank on the deal, which will be used to refinance debt and to help fund the sale of a minority interest in the company.

To compensate for the term loan downsizing, the subordinated debt was raised to $90 million from $67.5 million and the equity was revised as well.

Woodstream is a Lititz, Pa., pest control and bird feeding company.

Vertrue OIDs firm up

Vertrue finalized the original issue discounts on both its $430 million seven-year first-lien term loan (Ba3/B+) and its $200 million eight-year second-lien term loan (Caa1/CCC+) at 97, according to a market source.

Most recently, it was said that the first- and second-lien term loans were going to be sold at a discount, but the levels were still to be determined. Prior to that, the tranches were expected to carry a discount of 99.

The first-lien term loan is priced at Libor plus 300 bps, and the second-lien term loan is priced at Libor plus 700 bps, with call protection of non-callable for one year, then at 102 in year two and 101 in year three.

Last week, pricing on the first-lien term loan was flexed up from revised talk of Libor plus 250 bps and original talk of Libor plus 225 bps to 250 bps, pricing on the second-lien term loan was flexed up from revised talk of Libor plus 650 bps and from original talk of Libor plus 550 bps to 575 bps and second-lien call protection was changed from just 102 in year one and 101 in year two.

Vertrue's $660 million credit facility also includes a $30 million six-year revolver (Ba3/B+) priced at Libor plus 300 bps, with a 50 bps commitment fee.

Revolver pricing was also flexed up during syndication from revised talk of Libor plus 250 bps and original talk of Libor plus 225 bps to 250 bps.

Lehman and JPMorgan acted as the joint lead arrangers and joint bookrunners on the deal, which already funded but has not yet allocated, with Lehman the administrative agent and JPMorgan the syndication agent.

Proceeds were used to help fund the buyout of Vertrue by management, One Equity Partners, Oak Investment Partners and Rho Ventures for $50 in cash per share of common stock.

Vertrue is a Norwalk, Conn., internet direct marketing services company.

Continental restructures as all pro rata

Continental Conveyor & Equipment Co. restructured its credit facility, turning the ABL revolver into a cash revolver and switching the term loan B into a term loan A, according to a market source.

The $40 million cash revolver and $120 million term loan A (B3/B) are both being talked at Libor plus 300 bps, the source said.

By comparison, when the deal launched in July, it was structured as a $40 million five-year ABL revolver and a $120 million six-year term loan B talked at Libor plus 275 bps.

JPMorgan is the lead bank on the $160 million deal.

Proceeds will be used to refinance existing debt, including existing bonds.

Continental Conveyor is a Winfield, Ala., manufacturer and distributor of bulk material conveyor systems.

Alliant to be funded by underwriters

Alliant Insurance Services Inc.'s $420 million credit facility (B3/B-) is expected to be funded by lead banks JPMorgan and UBS, as opposed to being syndicated, according to a market source.

The deal, which had launched to investors in July, consists of a $60 million revolver and a $360 million term loan B.

The term loan B was being talked at Libor plus 275 bps.

Proceeds will be used to fund the acquisition of the company by the Blackstone Group and management and employees from Lindsay Goldberg.

Alliant is an insurance brokerage firm.

LCDX starts strong, ends unchanged

LCDX began Monday morning at better levels and continued to inch up from there; however, by the end of the session, levels came back in to go out unchanged on a day-over-day basis, according to traders.

The index ended the day around 95 1/8 bid, 95 3/8 offered, same levels seen at Friday's close, traders said.

But at the open on Monday, the index was quoted at 95¼ bid, 95½ offered and moved as high as 95 5/16 bid, 95 9/16 offered before settling back down, traders continued.

"Not sure what really brought it back in. Maybe some sellers," one trader remarked.

"Very little volume today overall in cash and the index," a second trader added.

Exterran closes

Universal Compression Holdings, Inc. and Hanover Compressor Co. completed their merger into a new publicly traded company called Exterran Holdings Inc., according to a news release.

In connection with the transaction, Exterran got a new approximately $1.7 billion senior secured credit facility (Ba2/BB+) consisting of a revolver and a term loan A.

Wachovia and JPMorgan acted as the lead banks on the deal.

Exterran also got an approximately $800 million asset-backed securitization facility.

Proceeds are being used to fund the redemption or repurchase of all of Universal Compression's and Hanover's outstanding debt other than Hanover's convertible debt securities and the credit facility of Universal's publicly traded subsidiary, Universal Compression Partners, LP.

Universal Compression is a Houston-based natural gas compression services company. Hanover is a Houston-based provider of services for the oil and natural gas industry.

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