Neiman, West rise; NBTY tweaks deal; Burger King, HGI, Alliance Laundry, CHG set talk

By Sara Rosenberg

New York, Sept. 14 - Neiman Marcus Inc.'s term loan headed higher in trading following the company's release of quarterly numbers, and West Corp.'s term loan B-2 was better with news of an amend and extend proposal and a paydown.

Moving to the primary market, NBTY Inc. increased the size of its credit facility while decreasing the amount of bonds it is selling, firmed pricing on the term loan B at the tight end of talk, added a step-down and accelerated the commitment deadline.

Also, Burger King Holdings Inc., HGI Holdings Inc., Alliance Laundry Systems LLC and CHG Healthcare Services all came out with price talk on their credit facilities as the deals were presented to lenders during the session.

And, Peak 10 Inc. revealed that it is getting ready to bring its buyout financing credit facility to market.

Neiman Marcus posts gains

Neiman Marcus' term loan was stronger in the secondary market as the company released fourth fiscal quarter numbers that showed a smaller net loss and an improvement in revenues and EBITDA from last year, according to traders.

The Dallas-based high-end specialty retailer's term loan was quoted by one trader at 96 3/8 bid, 96 7/8 offered, up from 96 bid, 96½ offered, and by a second trader at 96¼ bid, 96¾ offered, up from 95 7/8 bid, 96 3/8 offered.

For the fourth quarter of fiscal year 2010, the company reported a net loss of $32.8 million, compared to a net loss of $168.6 million in the prior year.

Total revenues for the quarter were $826.3 million, compared to $768 million in the 2009 fourth fiscal quarter.

Also, EBITDA for the quarter was $59.8 million, compared to a loss of $137.4 million in the previous year, and adjusted EBITDA for the quarter was $5.7 million.

West up with amendment

West's term loan B-2 due in 2013 jumped higher after news of an amend and extend transaction and a related paydown hit the market, according to traders.

The term loan B-2 was quoted by one trader at 98½ bid, 99½ offered, up from 96 7/8 bid, 97 5/8 offered, and by a second trader at 98 5/8 bid, 99 3/8 offered, up from 96¾ bid, 97½ offered.

Meanwhile, the company's term loan B-4 due 2016 was quoted by the first trader at 98 5/8 bid, 99 5/8 offered, unchanged on the day, and by the second trader at 98 5/8 bid, 99 3/8 offered, versus 98¾ bid, 99¼ offered on Monday.

Under the proposal, the company is looking to extend the maturity of its $250 million revolver to January 2016 from October 2012 and the maturity of $500 million of its term loans to July 2016 from October 2013.

The amendment will be subject to the sale of at least $500 million of senior unsecured notes that will be used to repay about $500 million of the term loans due October 2013.

West pricing bump

West is offering a pricing increase of 100 basis points across the grid on its extended revolver, and an increase of 150 bps on its extended term loan, which will be called the B-5 tranche, to Libor plus 387.5 bps from Libor plus 237.5 bps.

Terms on the new B-5 matches those on the previously extended term loan B-4.

Also, the amendment would modify the step-down schedule in the current financial covenants and modify certain covenant baskets.

Lenders are being offered a 12.5 bps amendment fee.

Wells Fargo and Deutsche Bank are the lead banks on the amendment that was launched with a 2:00 p.m. ET lender call on Tuesday, with Wells Fargo the left lead.

West is an Omaha, Neb.-based provider of outsourced communication services.

NBTY upsizes facility

Switching to the primary, NBTY came out with some updates to its credit facility on Tuesday morning, including increasing the entire deal by at least $250 million as a result of a $250 million reduction in its bond offering, according to a market source.

The term loan B is now sized at $1.5 billion, up from $1.3 billion, and the term loan A is now sized at $250 million, up from $200 million, the source said.

In addition, the revolver may also be increased, with the tranche now being described as sized at somewhere in the range of $200 million to $250 million, whereas before it was only $200 million.

In response to these changes, the company's senior unsecured notes offering was trimmed to $650 million from $900 million. A roadshow for the notes kicked off on Tuesday.

NBTY sets pricing

Along with the size changes, NBTY came out with firm pricing on its well oversubscribed term loan B that ended up - as expected by sources based on demand - at the tight end of talk.

Pricing on the term loan B is Libor plus 450 basis points with a 1.75% Libor floor and an original issue discount of 99, the source remarked. By comparison, at launch, the B loan was being talked at Libor plus 450 bps to 475 bps with a 1.75% Libor floor and an original issue discount of 98½ to 99.

Also, a step-down in spread was added to the term loan B under which pricing can drop to Libor plus 425 bps upon a leverage test being met, the source continued. This leverage test is still to be determined.

Pricing on the revolver and term loan A was left unchanged at Libor plus 425 bps with a 1.75% Libor floor. There are upfront fees based on commitment size.

NBTY moves deadline

Also as expected, NBTY accelerated the commitment deadline for its term loan B to 5 p.m. ET on Wednesday from Sept. 21 because interest has been so strong, the source said.

The term loan B was just launched to retail investors on Sept. 7, while the revolver and the term loan A were launched to banks on Aug. 11.

Barclays, Bank of America Merrill Lynch and Credit Suisse are the lead banks on the now $1.95 billion to $2 billion, up from $1.7 billion, senior secured credit facility (Ba3/BB-), with Barclays the left lead.

NBTY funding buyout

Proceeds from NBTY's credit facility, the notes and $1.6 billion in equity will be used to finance the acquisition of the company by the Carlyle Group for $55.00 per share in cash. The transaction is valued at $3.8 billion.

Closing on the transaction is expected to occur before the end of the year, subject to customary conditions, including approval of NBTY stockholders and regulatory approvals. It is not subject to any financing condition.

Stockholder approval will be sought at a special meeting on Sept. 22.

NBTY is a Ronkonkoma, N.Y.-based manufacturer and marketer of nutritional supplements.

Burger King talk revealed

In more new deal happenings, Burger King held a bank meeting on Tuesday to kick off syndication on its proposed credit facility, and in connection with the launch, price talk was announced, according to a market source.

The $1.75 billion institutional term loan is being talked at Libor plus 475 bps with a 1.75% Libor floor and an original issue discount of 981/2, the source said.

JPMorgan and Barclays Capital are the lead banks on the $1.9 billion credit facility, which also includes a $150 million revolver.

Proceeds from the facility will be used to help fund the acquisiton of the company by 3G Capital for $24 per share, or $4 billion, including the assumption of the company's outstanding debt.

Burger King selling notes

In addition to the credit facility, Burger King plans on selling $900 million of high-yield bonds to help fund its buyout.

Closing on the transaction is expected to take place in the fourth quarter, subject to satisfaction of the minimum tender condition of 79.1% of the company's common shares, the receipt of approval under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, the receipt of financing and other customary conditions.

It is anticipated that 3G Capital will begin a tender offer for all of the outstanding shares of the company no later than Sept. 17.

Burger King is a Miami-based fast food hamburger chain.

HGI guidance emerges

Another company to hold a bank meeting on Tuesday was HGI Holdings, at which time it too released price talk on its credit facility (B1/B+), according to a market source.

The $315 million six-year term loan was presented to lenders with talk of Libor plus 500 bps and the $50 million five-year revolver was presented with talk of Libor plus 475 bps, the source said.

Both tranches include a 1.75% Libor floor and are being offered at an original issue discount of 98, and the term loan has 101 soft call protection for one year.

Goldman Sachs, Jefferies and Morgan Stanley are the lead banks on the $365 million deal and are asking for commitments by Sept. 27.

HGI being acquired

Proceeds from HGI Holdings' credit facility will be used to help fund its buyout by Clayton, Dubilier & Rice LLC and GS Capital Partners from the Jordan Co. and members of the Harrington family.

Other financing for the transaction will come from $150 million of mezzanine debt.

Closing on the transaction is expected to take place in the beginning of the fourth quarter.

HGI is a Cleveland-based mail-order, direct-to-home provider of specialty medical products for chronic disease patients.

Alliance Laundry price talk

Alliance Laundry also came out with price talk on its proposed bank debt in connection with its Tuesday bank meeting, according to sources.

The $285 million six-year term loan was launched at Libor plus 475 bps with a 1.75% Libor floor and an original issue discount of 98 to 99, sources said, adding that there is 101 soft call protection for one year as well.

The company's $345 million senior secured credit facility also includes a $60 million five-year revolver.

Bank of America is the lead bank on the deal that will be used to refinance existing debt.

Alliance Laundry is a Ripon, Wis.-based provider of laundry products and services.

CHG releases talk

Yet another company to come out with price talk on Tuesday was CHG Healthcare Services as it launched its $355 million credit facility in the morning, according to a market source.

The $70 million revolver and $225 million first-lien term loan are both being talked at Libor plus 500 basis points to 550 bps, and the $60 million second-lien term loan is being talked at Libor plus 900 bps to 950 bps, the source said.

The revolver is being offered with upfront fees that are not currently being disclosed, the first-lien term loan is being offered at an original issue discount of 98 and has 101 soft call protection for one year, and the discount and call protection on the second-lien term loan are still to be determined.

All tranches have a 1.75% Libor floor.

CHG lead banks

Barclays, Bank of America and Goldman Sachs are the lead banks on CHG Healthcare Services' credit facility, with Barclays the left lead.

Proceeds will be used to repay debt and fund a dividend.

The company is expected to get high single-B corporate ratings, and leverage is 3.5 times through the first-lien and just under 4.5 times total.

CHG is a Salt Lake City-based health care staffing provider.

Peak 10 sets launch

Peak 10 is scheduled to hold a bank meeting on Thursday morning to launch its proposed $155 million credit facility, consisting of a $15 million revolver and a $140 million term loan B, according to a market source.

RBC is the lead bank on the deal that will be used to help fund the buyout of the company by Welsh, Carson, Anderson & Stowe from Seaport Capital and McCarthy Capital.

The transaction is expected to close in early October.

Peak 10 is a data center operator and managed services provider.

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