United Natural Foods sets talk; Altice USA launches $1.28 billion

By Paul A. Harris

Portland, Ore., Oct. 2 – In Tuesday's leveraged loan market United Natural Foods Inc. set talk on its $2.05 billion seven-year term loan B (B2/B+).

And Altice USA, Inc. launched a $1,275,000,000 term loan B with a 7.25-year maturity via a Tuesday lender call.

Meanwhile the United Rentals (North America) Inc. $1 billion seven-year covenant-light term loan B (Baa3/BBB-) is oversubscribed, according to a loan trader who added that there was $1.3 billion in the book for the deal on Tuesday morning.

The deal is talked at Libor plus 175 basis points to 200 bps at 99.75.

The pricing and credit ratings notwithstanding, the acquisition deal is expected to garner attention from high-yield bond players, especially crossover accounts.

In the secondary market the new Envision Healthcare Corp. Libor plus 375 basis points seven-year covenant-light first-lien term loan B is trading poorly, the trader said, adding that the paper is generically 99½ bid, 99¾ offered.

The upsized $5.45 billion deal (from $5.05 billion), priced in late September at 99.75, rich to the 99 to 99.5 talk.

The deal came with more leverage than the mainstream bank loan accounts have a stomach for, the trader recounted.

However it had a sizable audience from the junk-bond world, the source added, remarking that when that dynamic comes into play – high-yield bond accounts playing highly leveraged bank deals – the loans tend to trade poorly.

The Envision LBO financing also included $1,225,000,000 issue of eight-year senior notes (Caa1/B-), which priced at par to yield 8¾%.

Those notes have lagged new issue price and have been bid in the 98s sources say.

Elsewhere, the daily cash flows of the dedicated bank loan accounts were positive on Monday, the most recent session for which data was available at press time, a trader said.

The loan funds saw $20 million of inflows on the day, including $10 million of inflows to the bank loan ETFs.

United Natural talk

United Natural Foods Inc. set talk on its $2.05 billion seven-year term loan B (B2/B+) at Libor plus 375 basis points with the launch of its $4.05 billion of credit facilities.

The loan has an original issue discount of 99.5 and a 0% Libor floor.

Commitments are due by Oct. 15.

Proceeds will be used to fund the acquisition of SuperValu for $32.50 per share in cash, or about $2.9 billion, including the assumption of outstanding debt and liabilities, and to refinance existing debt.

Altice USA launches $1.28 billion

Altice USA, Inc. launched a $1,275,000,000 term loan B with a 7.25-year maturity via a lender call on Tuesday.

Talk was set at Libor plus 225 basis points to 250 basis points with a 0% Libor floor and a 99.75 issue price.

Goldman Sachs and Credit Suisse are lead arrangers with Goldman on the left.

Proceeds will be used to refinance Suddenlink’s term loan B due 2025.

Commitments are due on Oct. 10.

EG Group allocates

EG Group set the tranche sizes for its $310 million equivalent U.S. and euro add-on senior secured term loans B due Feb. 6, 2025 (B2/B/B) and then allocated the financing.

The U.S. tranche via borrower EG America LLC is for $225 million and is priced at Libor plus 400 basis points with a 0% Libor floor and an original issue discount of 99.875.

The final discount is tighter than talk for a price of 99.75.

This portion is fungible with an existing $1.7 billion term B.

EG set the euro tranche at a size of €75 million. The borrower on this portion is EG Finco Ltd.

Pricing is Euribor plus 400 bps with a 0% Euribor floor, offered at par.

The euro tranche is fungible with an existing €1,185,000,000 loan.

Proceeds will be used to fund the acquisition of Minit Mart from TravelCenters of America LLC and pay related costs and expenses.

Coinmach prices $200 million

CSC ServiceWorks, the parent of Coinmach, priced an upsized $200 million add-on to its term loan B due Nov. 14, 2022 (B2/B) with a 325 basis points spread to Libor at 99.75.

The deal, which was upsized from $150 million, came on top of spread talk and on top of final price talk, which was 25 cents rich to initial talk of 99.5.

The add-on was being marketed in conjunction with a proposed amendment to the existing term loan. There is a 12.5 bps amendment fee on the existing loan.

The Plainview, N.Y.-based laundry equipment service provider plans to use the proceeds to fund acquisitions, to repay revolver borrowings and for general corporate purposes.

Triton Solar revised, downsized

Triton Solar US Acquisition Co. revived a seven-year first-lien covenant-light term B that has been sidelined since late summer.

The deal, which is downsized to $305 million from $415 million, comes with wider spread talk and a dramatically deeper discount.

New spread talk is Libor plus 600 basis points, versus 525 bps to 550 bps. The 0% Libor floor remains unchanged.

Price talk is 93 to 94, versus earlier talk of 98.5 to 99.

Commitments are due on Oct. 11.

Proceeds will be used to help fund the buyout of the company by Permira.

Contura Energy downsizes

Contura Energy Inc. downsized its seven-year senior secured first-lien term loan (B3/B) to $550 million from $600 million, set the coupon at the wide end of talk and lowered the issue price to 99 from 99.5.

The coupon was set at Libor plus 500 basis points, the wide end of the Libor plus 475 bps to 500 bps talk.

Amortization will be 5% per year.

The loan continues to have a 0% Libor floor.

Contura also further extended the commitment deadline to 4 p.m. ET on Tuesday from 4 p.m. ET on Sept. 28, a deadline already extended from Sept. 25.

Proceeds will be used to refinance the combined entity’s balance sheet in connection with the closing of the announced merger with Alpha Natural Resources Holdings Inc.

R.R. Donnelley revisions

R.R. Donnelley & Sons Co. extended the call protection and made covenant changes for its $400 million covenant-light term loan B (B1/B+) due January 2024.

The 101 soft call protection was increased to one year from six months.

Among the covenant changes, the cap on incremental debt was lowered to 2 times from 3 times.

Pricing remains Libor plus 500 basis points with a 0% Libor floor and an original issue discount of 99.

Commitments were due Tuesday.

Proceeds will be used to repay debt and for general corporate purposes.

Caprock Midstream to launch Thursday

BCP Raptor II, LLC will launch a $690 million seven-year term loan B at a bank meeting to be held at 12 p.m. ET on Thursday.

Proceeds will be used to help fund the acquisition of Caprock Midstream LLC by Blackstone Energy Partners. Caprock Midstream will be renamed BCP Raptor II.

Barclays is the left lead arranger.

Frontera Generation lender call

Frontera Generation Holdings LLC will kick off a $60 million incremental term loan B and an amendment to its existing term loan B with a lender call scheduled to start at 10 a.m. ET Wednesday.

Morgan Stanley Senior Funding, Inc. is the arranger.

The Mission, Texas-based gas turbine power generation facility plans to use the proceeds to fund cash to the balance sheet of Lonestar Generation LLC.

Red Ventures lender call

Red Ventures, LLC scheduled a lender call for 11 a.m. ET on Wednesday.

Bank of America Merrill Lynch, Barclays, Fifth Third, PNC, MUFG, Regions, Capital One, JPMorgan, Citigroup and Goldman Sachs are the lead arrangers.

The borrowers will be Red Ventures, Ruby Sub, LLC and new Imagitas, Inc.

Red Ventures is a Charlotte, N.C., technology company that manages sales from digital marketing to fulfillment.

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