Sinclair, LIN break; Rite Aid strengthens; Capital Safety, Datatel, Endurance tweak deals

By Sara Rosenberg

New York, Dec. 15 - Sinclair Television Group Inc.'s incremental term loan B2/B3 made its way into the secondary market on Thursday afternoon, with levels quoted above its original issue discount price, and LIN Television Corp.'s term loan B freed up too.

Also in trading, Rite Aid Corp.'s term loans headed higher after the company released favorable third fiscal quarter 2012 results that showed a year-over-year improvement in earnings, revenues and adjusted EBITDA.

Moving to the primary, Capital Safety reworked its credit facility structure, upsizing its oversubscribed term loan B as the decision was made to get less private placement notes and revising pricing lower.

Additionally, Datatel Inc. (Sophia LP) upsized its term loan B and cut the discount price, and Endurance International Group reverse flexed pricing on its credit facility and tightened the discount on the B tranche.

Sinclair tops OID

Sinclair Television's $372.5 million incremental term loan B3/B3 due October 2016 began trading on Thursday, with levels quoted at 99º bid, par offered, according to a trader.

Meanwhile, the existing term loan B was quoted at 99æ bid, par º offered, the trader said.

Pricing on the incremental term B debt is Libor plus 300 basis points with a 1% Libor floor, and it was sold at an original issue discount of 99.

The company's new bank debt also includes a $157.5 million incremental term loan A due March 2016 that is priced at Libor plus 225 bps.

During syndication, the incremental B loan was upsized from $280 million and the discount tightened from 98Ω, and the incremental A loan was downsized from $250 million.

Sinclair lead banks

J.P. Morgan Securities LLC, Wells Fargo Securities LLC and Deutsche Bank Securities Inc. are the lead banks on Sinclair's $530 million deal (Ba1/BB+).

Along with the term loans, the company is amending its existing facility to increase the revolver from $75.4 million, extend the maturity to March 2016 from 2013 and gain flexibility under covenants.

Proceeds from the new term loan borrowings, cash on hand and/or a revolver draw will be used to fund the $385 million purchase of Freedom Communications' broadcast assets and the $200 million acquisition of Four Points Media Group LLC from Cerberus Capital Management LP.

Closing is expected on Freedom in early January and on Four Points in late March.

Sinclair is a Hunt Valley, Md.-based television broadcasting company. Freedom is an Irvine, Calif.-based media company operating print publications, broadcast television stations and interactive businesses. Four Points is an owner and operator of seven stations.

LIN frees up

LIN Television finalized pricing on its $260 million seven-year term loan B (Ba3/BB-) in the morning, and then broke for trading in the afternoon, with levels quoted at 99Ω bid, par º offered, according to a trader.

Pricing on the B loan is Libor plus 375 bps with a 1.25% Libor floor and an original issue discount of 99, versus initial talk of Libor plus 375 bps to 400 bps with a 1.25% floor and a discount of 98Ω. There is 101 soft call protection for one year.

J.P. Morgan Securities LLC, Wells Fargo Securities LLC and Deutsche Bank Securities Inc. are the lead banks on the deal that will be used to redeem all of the company's outstanding 6Ω% senior subordinated notes due 2013.

Closing on the loan is expected this month, and the notes repurchase will take place in January.

LIN is a Providence, R.I.-based television and digital media company.

Preferred Sands steady

Continuing on the topic of new issues, Preferred Sands, a Radnor, Pa.-based provider of silica sand products, saw its $225 million term loan B continue to be quoted at 97Ω bid, 98 offered after breaking for trading at that level late Wednesday, according to a market source.

Pricing on the term loan B is Libor plus 600 bps with a 1.5% Libor floor, and it was sold at an original issue discount of 97Ω. There is 101 soft call protection for one year.

During syndication, the spread increased from talk of Libor plus 500 bps to 525 bps and the discount moved from guidance of 98 to 98Ω.

The company's $406 million five-year credit facility (B2/BB-) also includes a $151 million term loan A, which was downsized from $175 million, and a $30 million revolver. Both tranches priced in line with initial talk at Libor plus 450 bps with an offer price of 99.

Barclays Capital Inc., KeyBanc Capital Markets LLC and J.P. Morgan Securities LLC are leading the deal that will refinance existing debt, make a small acquisition and buy out some minority investors.

Rite Aid rises

In more trading happenings, Rite Aid's term loans saw a noticeable improvement in the secondary market on Thursday following the company's earnings announcement, according to a trader.

The tranche 2 loan was quoted at 94æ bid, 95æ offered, up from 93æ bid, 94Ω offered, and the tranche 5 loan was quoted at 95æ bid, 96æ offered, up from 94æ bid, 95æ offered, the trader said.

For the third fiscal quarter ended Nov. 26, the company reported a net loss of $52 million, or $0.06 per diluted share, compared to a net loss of $79.1 million, or $0.09 per diluted share, last year.

Revenues for the quarter were $6.3 billion, versus $6.2 billion in the previous year's third quarter.

And, adjusted EBITDA for the quarter was $221.5 million, compared to $212.5 million in the 2011 fiscal year.

Rite Aid updates guidance

Furthermore, Rite Aid said that it revised fiscal 2012 guidance, moving the net loss expectation to between $325 million and $440 million, or $0.37 to $0.50 per diluted share of, compared to prior estimates of a loss between $345 million and $495 million, or $0.40 to $0.56 per diluted share.

Adjusted EBITDA for the year is now anticipated to be between $865 million and $910 million versus earlier guidance of between $825 million and $900 million.

Sales, meanwhile, are guided at $25.85 billion to $26 billion for the year, roughly unchanged from prior estimates of $25.8 billion to $26.1 billion.

Rite Aid is a Camp Hill, Pa.-based drugstore chain.

Capital Safety revises deal

Over in the primary, Capital Safety made a number of modifications to its credit facility on Thursday morning, including lifting the seven-year term loan B to $425 million from $375 million as the senior unsecured notes being arranged with Crescent Capital Group were cut to $125 million from $175 million, according to a market source.

In addition, the term loan B was turned into a covenant-light structure through the removal of a net leverage maintenance coverage ratio, the source said.

Also, pricing on the B loan, and on the company's $45 million five-year revolver, firmed late in the day at Libor plus 500 bps. Talk had been revised in the morning to Libor plus 500 bps to 525 bps from just Libor plus 525 bps at launch, the source remarked.

The revolver continues to have no Libor floor, the term loan B still has a 1.25% Libor floor and 101 soft call protection for one year, and both tranches remain offered at an original issue discount of 98.

Capital Safety readies

Leads UBS Investment Bank, Morgan Stanley Senior Funding Inc., Mizuho Securities USA Inc. and KKR Capital Markets were seeking recommitments towards Capital Safety's credit facility by 3 p.m. ET on Thursday, with the plan being to allocate on Friday, the source added.

Proceeds from the now $470 million senior secured credit facility (Ba3/B), up from $420 million, and the junior capital will be used to fund the $1.12 billion buyout of the company by Kohlberg Kravis Roberts & Co. LP from Arle Capital Partners.

As a result of the changes, senior leverage is now 4.25 times, up from 3.75 times previously, while total leverage is unchanged at 5.25 times.

Capital Safety, a Red Wing, Minn.-based provider of fall protection equipment, expects to close on its buyout in January, subject to customary conditions, including regulatory approval.

Datatel reworks loan

Datatel (Sophia) was another company to make issuer friendly changes to its facility, upsizing the 6Ω-year term loan B to $1.075 billion from $1.07 billion to fund the original issue discount, which was moved to 98Ω from 98, according to a market source.

Pricing on the B loan remained at Libor plus 500 bps with a 1.25% Libor floor, and the 101 soft call protection for one year was left intact as well.

The company's now $1.2 billion credit facility (B1/B+), up from $1.195 billion, also provides for a $125 million five-year revolver priced at Libor plus 475 bps with no Libor floor.

Recommitments were due at 5 p.m. ET on Thursday, with allocations expected for Friday.

Bank of America Merrill Lynch, Barclays Capital Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC and J.P. Morgan Securities LLC are leading the deal.

Datatel funding merger

Proceeds from Datatel's credit facility, along with $530 million of notes backed by commitment for a senior unsecured bridge loan, will be used to fund the $1.775 billion acquisition of SunGard Higher Education by Hellman & Friedman LLC from SunGard Data Systems Inc. and the concurrent merger with Datatel, an existing Hellman & Friedman portfolio company.

Once SunGard Higher Education is merged with Datatel, the combined company will operate under a new name that will be announced by the parties at the closing of the transactions.

Datatel is a Fairfax, Va.-based provider of technology products, services and insight to higher education. SunGard Higher Education is a Malvern, Pa.-based provider of software and services to the higher education community.

Endurance tightens pricing

Also making changes was Endurance International, as it trimmed pricing on its $400 million credit facility (B1/B) to Libor plus 625 bps from Libor plus 650 bps and moved the original issue discount on the term loan B to 98 from 97Ω, according to a market source.

The facility, which still has a 1.5% Libor floor, is comprised of a $50 million five-year revolver and a $350 million six-year term loan B. As before, the B loan has 101 soft call protection for one year.

With the flex, the company removed the 18 month sunset on the most favoured nation clause.

Credit Suisse Securities (USA) LLC is the lead bank on the deal and is seeking recommitments by end of day Friday, with the intention being that allocations will go out early next week.

Proceeds will be used to help fund the purchase of a majority interest in the company by Warburg Pincus and GS Capital Partners from Accel-KKR.

Endurance, a Burlington, Mass.-based provider of web hosting and online services, will have secured leverage of 3.5 times.

CVR Energy closes

In other news, CVR Energy Inc. closed on its $150 million ABL credit facility add-on, bringing the total deal size to $400 million, according to a news release.

Deutsche Bank Securities Inc., Barclays Capital Inc., RBS Securities Inc. and SunTrust Robinson Humphrey Inc. led the deal.

Proceeds, along with cash on hand and $200 million in bonds, were used to fund the acquisition of Gary-Williams Energy Corp. for $525 million, plus working capital currently estimated at $100 million.

CVR is a Sugar Land, Texas-based refiner and marketer of transportation fuels. Gary-Williams Energy is a Denver-based oil and gas company.

Global Tel buyout wraps

American Securities LLC completed its purchase of Global Tel*Link Corp. from Veritas Capital and GS Direct, according to a news release.

To fund the transaction, Global Tel*Link got a new $685 million credit facility (B2/B) consisting of a $50 million five-year revolver and a $635 million six-year term loan B, both priced at Libor plus 550 bps with a 1.5% Libor floor. The B loan was sold at an original issue discount of 98 and has 101 soft call protection for one year.

During syndication, pricing on the facility was reduced from Libor plus 600 bps, the term B was upsized from $605 million as the equity portion was downsized by $30 million, and the discount tightened from 97.

Credit Suisse Securities (USA) LLC, UBS Securities LLC, GE Capital Markets and Nomura led the deal for the Mobile, Ala.-based correctional communications technology company.

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