Horizon Pharma breaks; Avaya updated; Script Relief, Air Canada, Sensata, Veresen launch

By Sara Rosenberg

New York, April 28 – Horizon Pharma Inc.’s term loan B made its way into the secondary market on Wednesday, with levels quoted above its original issue discount.

Meanwhile, in the primary market, Avaya Inc. upsized its term loan B-7 and finalized the spread at the high end of guidance, Script Relief LLC and Air Canada revealed details on their loan transactions, and Sensata Technologies BV and Veresen Midstream LP launched repricing proposals.

Furthermore, Quintiles Transnational Corp., Smart & Final Stores Inc. and Grocery Outlet Inc. (GOBP Holdings Inc.) surfaced with new deal plans.

Horizon hits secondary

Horizon Pharma’s $400 million six-year senior secured covenant-light term loan B (Ba2/BB-) began trading on Wednesday, with levels seen at par 5/8 bid, 101 1/8 offered, according to a trader.

Pricing on the term loan is Libor plus 350 basis points with a 1% Libor floor, and it was sold at an original issue discount of 99½. There is 101 soft call protection for six months.

During syndication, the term loan was downsized from $500 million as the company’s senior notes offering was upsized to $475 million from $300 million, the spread was lowered from Libor plus 400 bps, and the discount was tightened from 99.

Citigroup Global Markets Inc. and Jefferies Finance LLC are leading the loan that is expected to close on May 7.

Horizon buying Hyperion

Proceed from Hyperion’s loan and bonds will be used with cash on hand to fund the acquisition of Hyperion Therapeutics Inc., a Brisbane, Calif.-based commercial-stage biopharmaceutical company, for $46.00 per share in cash, or about $1.1 billion on a fully diluted basis, and to refinance existing debt.

The $75 million of additional proceeds being raised from the bond offering will be used for general corporate purposes.

Closing on the acquisition is subject to customary conditions, including the tender of a majority of the outstanding Hyperion Therapeutics shares and expiration or termination of the Hart-Scott-Rodino waiting period.

Horizon Pharma is a Dublin-based specialty biopharmaceutical company.

Avaya revises loan

Moving to the primary market, Avaya increased its five-year senior secured term loan B-7 to $2,125,000,000 from $1.5 billion and set pricing at Libor plus 525 bps, the wide end of the Libor plus 500 bps to 525 bps talk, while leaving the 1% Libor floor, original issue discount of 99 and 101 soft call protection for six months unchanged, according to a market source.

Allocations are expected later this week, the source said.

Citigroup Global Markets is leading the deal that will be used to repay existing senior secured term loans.

The funds from the B-7 upsizing will result in a larger paydown, the source added.

Avaya is a Santa Clara, Calif.-based provider of business collaboration and communications services.

Script Relief details loan

Script Relief held its bank meeting on Wednesday, launching a $205 million seven-year senior secured first-lien covenant-light term loan B (B2/B+) with talk of Libor plus 400 bps to 425 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, according to a market source.

Citigroup Global Markets is leading the deal that will be used to fund a dividend.

Commitments are due at 5 p.m. ET on May 8, and closing is targeted for May 15, the source said.

Script Relief is a New York-based provider of pharmacy discount cards.

Air Canada holds call

Air Canada revealed on its late-morning lender call that it is seeking a $510 million senior secured credit facility to reprice its existing credit facility, a market source said.

The facility consists of a $210 million revolver due Sept. 26, 2018 and a $300 million term loan B due Sept. 26, 2019.

Talk on the term loan B repricing is Libor plus 325 bps to 350 bps with a 1% Libor floor, compared to current pricing of Libor plus 450 bps with a 1% Libor floor, the source continued. The repriced loan is offered at par and has 101 soft call protection for six months.

Cashless roll commitments are due on Tuesday, new money commitments are due on May 6, and closing is expected during the week of May 11, the source added.

Citigroup Global Markets is leading the deal for the Montreal-based airline company.

Sensata repricing

Sensata Technologies approached lenders with a repricing of its $990.1 million of term loan B debt that is talked at Libor plus 225 bps with a 0.75% Libor floor, an original issue discount of 99½ to 99¾ and 101 soft call protection for one year, according to a market source.

Also, the company is asking to extend the maturity on its $393.1 million term loan B to Oct. 14, 2021 from May 12, 2019 so as to be co-terminus with the existing $597 million term loan B due Oct. 14, 2021.

The 2019 term loan is currently priced at Libor plus 250 bps with a 0.75% Libor floor, and the 2021 term loan is currently priced at Libor plus 275 bps with a 0.75% Libor floor.

Commitments are due at noon ET on Tuesday, the source added.

Morgan Stanley Senior Funding Inc. and Barclays are leading deal.

Sensata is a supplier of sensing, electrical protection, control and power management services.

Veresen comes to market

Veresen Midstream launched a repricing of its $575 million term loan B that is talked at Libor plus 425 bps with a 1% Libor floor, a par offer price and 101 soft call protection for one year, a source said.

The repricing will take the loan down from Libor plus 500 bps with a 1% Libor floor, and lenders will get paid out at 101 due to existing call protection.

Commitments are due on May 6, the source added.

RBC Capital Markets, TD Securities (USA) LLC and HSBC Securities (USA) Inc. are leading the deal.

Veresen Midstream is a midstream energy company.

Quintiles readies deal

Also in the primary, Quintiles Transnational set a call for Thursday to launch a $1.75 billion senior secured credit facility, a market source remarked.

The facility consists of a $500 million five-year revolver, a $750 million five-year term loan A, and a $500 million seven-year term loan B talked at Libor plus 275 bps to 300 bps with a 0.75% Libor floor, an original issue discount of 99¾ and 101 soft call protection for six months, the source continued.

J.P. Morgan Securities LLC, Barclays, Morgan Stanley Senior Funding, Bank of America Merrill Lynch, MUFG and PNC Bank are leading the deal that will be used with $800 million of unsecured debt to refinance an existing credit facility and for general corporate purposes, including corporate transactions and equity repurchases.

Quintiles is a Durham, N.C.-based provider of biopharmaceutical development and commercial outsourcing services.

Smart & Final plans call

Smart & Final Stores emerged with plans to hold a lender call at 2 p.m. ET on Thursday to launch an amendment to its existing $595 million senior secured term loan B, according to a market source.

The amendment will revise pricing and optional prepayment, the source said.

Morgan Stanley Senior Funding, Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc. are leading the deal.

Smart & Final is a Commerce, Calif.-based warehouse-style, no-membership fee, multi-format retailer serving households and smaller businesses.

Grocery Outlet on deck

Grocery Outlet scheduled a call for noon ET on Thursday to launch an amendment and repricing of its $449 million senior secured first-lien term loan, according to a market source.

Morgan Stanley Senior Funding and Deutsche Bank Securities are leading the deal.

Grocery Outlet is an Emeryville, Calif.-based grocery store operator.

Mitel closes

In other news, Mitel Networks Corp. completed its $710 million senior secured credit facility (Ba3/B+) that includes a $50 million five-year revolver and a $660 million seven-year first-lien term loan B, both priced at Libor plus 400 bps, a news release said.

The term loan B has a 25 bps step-down at 2.75 times net leverage, a 1% Libor floor and 101 soft call protection for six months and was sold at an original issue discount of 99.

During syndication, the B loan was upsized from $650 million, and the spread was reduced from talk of Libor plus 425 bps to 450 bps.

Bank of America Merrill Lynch and Credit Suisse Securities led the deal that was used with cash on hand to fund the acquisition of Mavenir Systems Inc. and to refinance existing credit facilities at both companies.

Mitel is a Kanata, Ont.-based provider of cloud- and premises-based unified communications software solutions. Mavenir is a Richardson, Texas-based provider of software-based networking solutions for mobile carriers.

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