Warner Chilcott tweaks deal, breaks; Brock, Ntelos free up; MetroPCS revises pricing

By Sara Rosenberg

New York, March 14 - Warner Chilcott plc upsized its term loan A and downsized its term loan B, a move that was expected by the market since late last week, and after the revisions were made, the deal allocated and freed up for trading.

Also hitting the secondary market on Monday was Brock Holdings Inc.'s credit facility, with levels on the first- and second-lien term loans quoted above their original issue discount prices, and Ntelos Holding Corp. broke as well.

In more secondary news, Universal Health Services Inc.'s term loan B was bid a little stronger compared to where it broke late Friday, and Univision Communications Inc.'s term loan was weaker with the rest of the market and with news of a management change.

Returning to primary happenings, MetroPCS Wireless Inc. increased the spread on its term loan and is now offering the debt at a discount, and Laureate Education Inc., Western Refining Inc., Farley's & Sathers Candy Co. Inc. and Postmedia Network Inc. released price talk as their new deals were presented to lenders during the session.

Warner Chilcott retranches

Warner Chilcott shifted some funds out of its term loan B and into its term loan A on Monday morning to take advantage of the lower pricing that the term loan A offers and the big bank group that the company has in place, according to a market source.

The five-year term loan A is now sized at $1.25 billion, up from $750 million, and pricing is set at Libor plus 300 basis points with a 0.75% Libor floor and a par offer price, the source said. The Libor floor was reduced from initial talk of 1%.

Meanwhile, the seven-year term loan B is now sized at $1.75 billion, down from $2.25 billion, with pricing remaining at Libor plus 325 bps with a 1% Libor floor and a par offer price. There is still 101 soft call protection for six months.

The company's $3.25 billion credit facility (BBB-) also includes a $250 million five-year revolver priced at Libor plus 300 bps with no Libor floor.

Warner starts trading

Once the changes were finalized, Warner Chilcott's deal broke for trading, with the term A quoted at par bid, par ¼ offered and the term B quoted at par 1/8 bid, par 3/8 offered, according to a trader.

Proceeds from the Ireland-based specialty pharmaceutical company's facility will be used to refinance existing bank debt, which had $3.419 billion in term loans outstanding as of Dec. 31.

In August 2010, the company got a $1.02 billion 51/2-year term loan B priced at Libor plus 425 bps with a 2.25% Libor floor that was sold at a discount of 99 and includes 101 soft call protection for one year. It also obtained a $480 million four-year term loan A priced at Libor plus 425 bps and amended its existing credit facility, increasing pricing on an existing term loan A to Libor plus 375 bps and on an existing term loan B to Libor plus 400 bps, with both having a 2.25% Libor floor.

J.P. Morgan, Bank of America Merrill Lynch, Goldman Sachs and Morgan Stanley are the lead banks on the new deal, which is expected to close around mid-March.

Brock frees up

Brock Holdings' credit facility also made its way into the secondary market, with the $510 million six-year first-lien term loan B (B1/B+) quoted at 99½ bid, par offered on the open and the $190 million seven-year second-lien term loan (Caa1/B-) quoted at par bid on the open, according to a trader.

Shortly after the break, the first-lien loan moved to 99 7/8 bid, par ¼ offered and the second-lien moved to 101 bid, a second trader said.

Pricing on the first-lien term B is Libor plus 450 bps with a 1.5% Libor floor, and it was sold at an original issue discount of 991/4. There is 101 soft call protection for one year.

As for second-lien loan, pricing is Libor plus 825 bps with a 1.75% Libor floor, and it was sold at a discount of 98. The loan is non-callable for one year, then at 103 in year two, 102 in year three and 101 in year four.

The company's $805 million credit facility also provides for a $105 million revolver (B1/B+).

Brock lead banks

J.P. Morgan, Credit Suisse and Bank of America Merrill Lynch are leading Brock's facility that is being used to refinance existing debt, to fund a dividend payment and for general corporate purposes.

During syndication, the first-lien term loan was upsized from $490 million when the second-lien was downsized from $210 million.

In addition, pricing on the first-lien loan firmed at the low end of the Libor plus 450 bps to 475 bps talk, and the discount tightened from 99, while pricing on the second-lien loan was flexed up from talk of Libor plus 750 bps to 775 bps, the discount widened from 98½ and call protection was sweetened from 103 in year one, 102 in year two and 101 in year three.

Brock is a Houston-based provider of industrial specialty maintenance services, including painting, scaffolding and insulation.

Ntelos breaks

Ntelos was another deal to start trading on Monday, with its $750 million first-lien term loan due Aug. 7, 2015 quoted at par bid, par 3/8 offered, according to a trader.

Pricing on the loan is Libor plus 300 bps with a 1% Libor floor, and it was sold at par. There is a step-down to Libor plus 275 bps at less than 2.75 times leverage that was added during syndication, and 101 soft call protection for six months.

J.P. Morgan and UBS are the lead arrangers on the deal that is being used by the Waynesboro, Va., provider of wireless and wireline communications services to reprice existing term loan debt.

In 2010, the company got a $125 million incremental term loan, and it obtained a $635 million term loan in 2009, with both of these tranches priced at Libor plus 375 bps with a 2% Libor floor. The incremental loan had been sold at an original issue discount of 99¾ and was used for the acquisition of FiberNet, while the 2009 loan was sold at an original issue discount of 99 and was used to refinance debt.

Universal Health bid rises

Universal Health's $1.475 billion term loan B due Nov. 15, 2016 was quoted at par 1/8 bid, par ½ offered in the afternoon, up slightly from the par bid, par ½ offered level that was seen when it freed up for trading late Friday night, according to traders.

Earlier in the Monday session, the term loan B had been as high as par ¼ bid, par 5/8 offered, traders added.

Pricing on the term loan B is Libor plus 300 bps with a step-down to Libor plus 275 bps at less than 3.25 times leverage, which was added during syndication. There is a 1% Libor floor and 101 soft call protection until Nov. 15, 2011, and the debt was issued at par.

Universal Health paydown

Initially, it was thought that Universal Health's term loan B would be sized at $1.6 billion, but the company did an optional prepayment of $125 million ahead of syndication, a market source remarked.

The company's $3.325 billion credit facility also includes an $800 million revolver due Nov. 15, 2015 and a $1.05 billion term loan A due Nov. 15, 2015.

J.P. Morgan and Deutsche Bank are leading deal that is being used to refinance existing debt.

Universal Health is a King of Prussia, Pa.-based health-care management company.

Univision softens

Univision Communications' term loans headed lower as the market in general was weaker, and the company announced that its president and chief executive officer, Joe Uva, is leaving to seek other opportunities, according to a trader.

The extended term loan was quoted at 96 1/8 bid, 96 5/8 offered, down from 96½ bid, 97 offered, and the non-extended term loan was quoted at 96 bid, 96¾ offered, down from 96 3/8 bid, 96 7/8 offered, the trader said.

Uva's departure will become effective on April 2, and while the company looks for a new chief executive officer, Haim Saban, executive chairman, will assume additional responsibilities to ensure a smooth transition.

Univision is a New York-based Spanish-language media company.

CRC extended bid lower

CRC Health Corp.'s extended term loan was unchanged at 98½ bid, 99¼ offered versus Friday's levels of 98¾ bid, 99¼ offered, as news emerged that the effort to make the tranche covenant-light was terminated, and as a result, lenders will no longer be getting a 1% Libor floor, according to a trader.

However, the trader said that the bit of pressure seen in the extended loan was more likely caused by the soft secondary market rather than by the actual credit specific news.

The company is still moving forward with plans to get an incremental $120 million term loan (B1) due Nov. 16, 2015 that is talked at Libor plus 450 bps with a 1% Libor floor and a discount of 99 to 991/2.

Citigroup is the lead bank on the new deal that will be used to refinance non-extended term loan borrowings and repay revolver debt. In January, the company extended about $309 million of its $399 million term loan to Nov. 16, 2015 at a price of Libor plus 450 bps. The roughly $90 million of non-extended term loan that is being refinanced matures on Feb. 6, 2013 and is priced at Libor plus 225 bps.

CRC is a Cupertino, Calif., provider of substance abuse treatment and adolescent youth services.

OWIC surfaces

A $221 million offers wanted in competition emerged on Monday, and offers towards the transaction are due on Tuesday morning, according to sources.

There are 24 issuers in the OWIC, including Aramark Corp., Bausch & Lomb Inc., Booz Hamilton Allen Inc., Community Health Systems Inc., DaVita Inc., Education Management LLC, General Nutrition Center, HCA Inc., Intelsat Corp., Nielsen Finance LLC, Sedgwick CMS Holdings Inc., TransDigm and West Corp.

The buyer is looking to buy positions in these loans, as well as in a number of others, in a range from $5 million to $15 million depending on the issuer.

MetroPCS flexes up

Back in the primary, MetroPCS Wireless raised pricing on its $1.5 billion term loan (Ba1/BB) to Libor plus 375 bps from Libor plus 350 bps and is now offering the tranche at an original issue discount of 99½ to 993/4, as opposed to at par, according to a market source. The loan still has no Libor floor and 101 soft call protection for one year.

J.P. Morgan and Wells Fargo are the lead banks on the deal and are asking for recommitments by noon ET on Tuesday.

Proceeds will be used to repay a $500 million term loan maturing in 2013 priced at Libor plus 225 bps and for general corporate purposes, including opportunistic spectrum acquisitions.

Closing is expected to occur this month.

MetroPCS is a Dallas-based provider of unlimited wireless communications service for a flat-rate with no annual contract.

Laureate details revealed

Laureate Education came out with structure and price talk on its proposed credit facility in connection with the 2 p.m. ET bank meeting that took place, according to a market source.

The $1.595 billion senior secured credit facility consists of a $300 million five-year revolver and a $1.295 billion seven-year term loan B talked at Libor plus 325 bps to 350 bps with a 1.25% Libor floor and an original issue discount of 991/2, the source said.

Citigroup, Barclays, Credit Suisse, Goldman Sachs, J.P. Morgan and KKR Capital Markets are leading the deal that will be used to refinance all of the company's bank debt, including a $280 million term loan priced at Libor plus 500 bps with a 2% Libor floor and a $675 million term loan priced at Libor plus 325 bps.

Laureate is a Baltimore-based provider of higher educational services.

Western Refining sets talk

Western Refining held a conference call at 2 p.m. ET on Monday to kick off syndication on its $325 million covenant-light term loan B (B3) due March 15, 2017, and shortly before the event took place, price talk emerged, according to a market source.

The El Paso, Texas-based refining and marketing company's B loan is being talked at Libor plus 550 bps with a 1.5% Libor floor, an original issue discount of 99 to 99½ and hard call protection of 102 in year one and 101 in year two with par prepayment for select asset sales, the source said.

Details on the Libor floor and call protection had actually been announced on Friday, but the spread and the original issue discount had been unavailable.

Bank of America Merrill Lynch is the lead arranger on the deal that will be used to refinance existing debt. The company's existing term loan due May 30, 2014 is priced at Libor plus 750 bps with a 3.25% Libor floor. At Dec. 31, the fair value of the term loan was $346.9 million.

Farley's guidance emerges

Farley's & Sathers Candy revealed price talk of Libor plus 425 bps with a 1.5% Libor floor on its $245 million credit facility that was launched with a bank meeting on Monday afternoon, according to a market source.

The $60 million five-year revolver is being offered with a 150 bps upfront fee, and the $185 million seven-year term loan B is being offered at an original issue discount of 99 to 99½ and includes 101 soft call protection for one year, the source said.

Bank of America Merrill Lynch, GE Capital Markets and RBS Capital Markets are the lead banks on the deal that will be used to refinance existing debt.

Farley's & Sathers is a Round Lake, Minn.-based manufacturer and distributor of confectionary and gum products.

Postmedia pricing

Also coming out with guidance was Postmedia Network, as it launched its $365 million term loan B with a call on Monday, according to a market source.

The loan is being talked at Libor plus 475 bps to 500 bps with a 1.25% Libor floor and an offer price of 99¾ to par, the source said.

J.P. Morgan and Goldman Sachs are the lead banks on the deal that will be used to refinance existing term loan A and B borrowings.

Postmedia Network is an Ontario-based publisher of paid English-language daily newspapers in Canada.

Airvana nets interest

In other news, Airvana Corp.'s $420 million four-year term loan has been attracting orders ahead of this week's commitment deadline, as "existing accounts continue to roll over and new guys are coming in," a market source told Prospect News.

Price talk on the loan is Libor plus 700 bps to 725 bps with a 1.5% Libor floor and an original issue discount of 99. The loan includes 101 soft call protection for one year and 15% annual amortization.

Societe Generale and Macquarie are the joint bookrunners on the deal that will be used to refinance an existing term loan obtained in August 2010 and fund a dividend payment. At close last year, the term loan was sized at $360 million and priced at Libor plus 900 bps with a 2% Libor floor. It was sold at an original issue discount of 98 and used for a dividend recapitalization.

Airvana, a Chelmsford, Mass.-based provider of mobile broadband network infrastructure products, will have total leverage of 1.8 times.

Jo-Ann well met

Jo-Ann Stores Inc.'s $1.025 billion senior secured credit facility is "meaningfully oversubscribed" now that the commitment deadline passed late last week, according to a market source.

The facility consists of a $375 million ABL revolver and a $650 million covenant-light term loan (B1/B+) that is talked at Libor plus 350 bps with a 1.25% Libor floor and an original issue discount of 991/2.

J.P. Morgan, Bank of America Merrill Lynch and Barclays are the lead banks on the deal that will be used, along with $450 million of 8 1/8% senior notes, to help fund the company's buyout by Leonard Green & Partners LP for $61 per share in cash, for a total price of around $1.6 billion.

Closing is expected by the end of March, subject to the receipt of regulatory approvals and stockholder approval, which will be sought at a meeting on March 18.

Jo-Ann Stores is a Hudson, Ohio-based specialty retailer of fabrics and crafts.

Hanger closes

Hanger Orthopedic Group Inc. completed the repricing of its $300 million term loan B to Libor plus 300 bps with a 1% Libor floor from Libor plus 375 bps with a 1.5% Libor floor, according to a news release.

The repriced term loan was sold at par, whereas, when the deal was originally obtained late last year at a size of $325 million in connection with the acquisition of Accelerated Care Plus, it was sold at an original issue discount of 991/2.

Existing lenders were repaid at 101 due to the presence of soft call protection.

Bank of America Merrill Lynch acted as the lead bank on the deal.

Hanger is an Austin, Texas-based provider of orthotic and prosthetic patient care services.

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