Ocwen breaks; SunGard Data bounces with asset sale news; Water Pik, U.S. Coal tweak deals

By Sara Rosenberg

New York, Aug. 5 - Ocwen Financial Corp.'s term loan made its way into the secondary market during Friday's session, with levels initially quoted above the original issue discount, but then it moved down to right around the discount price.

Also, SunGard Data Systems Inc.'s term loans moved around on news that its higher education business is being sold and merged with Datatel, while Datatel's first-lien term loan was unchanged since it's already trading around par.

Moving to the primary, Water Pik Inc. made a new change to its credit facility, this time increasing its term loan. After a recent downsizing and finalization of pricing at the wide end of talk, the deal was oversubscribed enough to allow for some of the lost funds to be put back in place.

Additionally, U.S. Coal Corp. sweetened amortization on its term loan, Plaze Inc. and Gencoat Inc. revealed plans to bring new deals to market, and Garden Ridge decided to postpone its credit facility launch to a later date.

Ocwen frees up

Ocwen Financial's $575 million five-year senior secured term loan (B1/B) broke for trading on Friday, with levels quoted at 98 1/8 bid, 98 5/8 offered on the open. It then dropped to 97¾ bid, 98¼ offered before settling in at 98 bid, 98¼ offered, according to a market source.

Pricing on the term loan is Libor plus 550 basis points with a 1.5% Libor floor, and it was sold at an original issue discount of 98. There is 101 soft call protection for one year.

During syndication, pricing on the Barclays Capital Inc.-led loan was reduced from Libor plus 575 bps as the deal was well-oversubscribed.

Pro forma for the transaction, corporate debt to run rate adjusted EBITDA is 1.7 times and total debt to total equity is 4.5 times.

Ocwen funding acquisition

Proceeds from Ocwen's term loan will be used to help finance the purchase of Litton Loan Servicing LP, a provider of servicing and subservicing of primarily non-prime residential mortgage loans, from Goldman Sachs Group Inc. for a base purchase price of $263.7 million in cash.

In addition, subject to adjustments based on outstanding servicer advances at closing, Ocwen will pay $337.4 million to retire a portion of the outstanding debt on an existing advance facility at Litton that was provided by Goldman.

Closing is expected on Sept. 1, subject to the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and other conditions.

Ocwen is an Atlanta-based provider of residential and commercial loan servicing, special servicing and asset management services.

SunGard moves around

SunGard's term loans saw a change in levels as the company revealed that it is selling SunGard Higher Education to Hellman & Friedman LLC for $1.775 billion in cash. It will then combine the acquired business with its existing portfolio company, Datatel, according to traders.

One trader had SunGard's new term loan quoted at 97¾ bid, 98¾ offered versus 97¾ bid, 98½ offered previously, its non-extended term loan quoted at 96 bid, 97½ offered, up from 95½ bid, 96¼ offered, and its extended term loan quoted at 97¾ bid, 98¾ offered, up from 97½ bid, 98¼ offered.

A second trader, meanwhile, had the non-extended term loan quoted at 96 bid, 98 offered, up from 95 bid, 96 offered, and the extended term loan quoted at 97 bid, 99 offered, compared to 97¼ bid, 98 offered previously.

Datatel holds steady

The other company involved in the SunGard Higher Education merger and acquisition news, Datatel, saw its first-lien term loan hold firm at 99¾ bid, par offered, another trader remarked, explaining that if it's taken out, it is expected to be done so at par.

The combined Datatel and SunGard Higher Education company will operate under a new name that will be announced by the parties at the closing of the transactions.

The transactions are subject to customary closing conditions, including applicable regulatory clearances, but are not subject to a financing condition or to receipt of any stockholder approvals.

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. And, SunGard is a Wayne, Pa.-based software and technology services company.

Water Pik upsizes loan

Over in the primary, Water Pik has now increased its six-year term loan to $140 million from a most recent size of $130 million as the deal was oversubscribed at updated terms, according to a market source. Earlier the loan had been downsized from an original amount of $177 million.

Pricing on the term loan, as well as on a $20 million five-year revolver, remained at Libor plus 525 bps, where it firmed the other week from initial talk of Libor plus 500 bps to 525 bps.

The tranches have a 1.5% Libor floor and an original issue discount of 99, and the term loan includes 101 soft call protection for one year.

GE Capital Markets is the lead bank on the now $160 million credit facility (B2/B), up from a revised size of $150 million but down from an original size of $197 million.

Water Pik funding recap

Proceeds from Water Pik's credit facility will be used to refinance existing debt and fund a dividend to the sponsors.

When the term loan was first downsized, the amount of the dividend was decreased, and now with this latest upsizing, the revised dividend size has been increased by $10 million.

Allocations on the deal and closing are expected to occur during the week of Aug. 8, the source added.

Water Pik is a Fort Collins, Colo.-based developer and manufacturer of personal and oral health care products.

U.S. Coal amortization

U.S. Coal modified the amortization on its $105 million six-year term loan (B2/B+) to 10% per annum from 1%, while leaving all other terms unchanged, according to a market source.

Price talk on the loan is Libor plus 600 bps with a 1.5% Libor floor and an original issue discount of 99, and there is call protection of 103 in year one, 102 in year two and 101 in year three.

Credit Suisse Securities (USA) LLC is the lead bank on the deal that will be used to refinance existing debt.

U.S. Coal is a Lexington, Ky.-based producer of coal in Central Appalachia.

Plaze coming soon

In more new deal happenings, Plaze has set a bank meeting for Tuesday to launch a proposed $150 million senior credit facility that is being led by GE Capital Markets and PNC Capital Markets LLC, according to a market source.

The facility consists of a $20 million revolver and a $130 million term loan, the source remarked, adding that price talk is not yet available.

Proceeds, along with $50 million of mezzanine debt, will be used to fund the buyout of the company by Olympus Partners.

Leverage through the senior facility is 3.75 times and leverage through the mezzanine financing is 5.25 times.

Plaze is a St. Clair, Mo.-based full service contract aerosol and liquid packager.

Gencoat sets launch

Gencoat has scheduled a bank meeting for Tuesday to launch a new credit facility, according to a market source.

GE Capital Markets is the lead bank on the deal.

Gencoat is a Sussex, Wis.-based designer, manufacturer and distributor of roll coaters, laminating equipment, Peabody electrostatic oilers, integrated coil processing lines and replacement parts.

Garden Ridge delays launch

Garden Ridge is no longer planning on holding a bank meeting for its $330 million credit facility on Monday, but will rather bring the deal to market at a later date, according to sources.

The facility consists of an $80 million ABL revolver and a $250 million six-year term loan B.

Bank of America Merrill Lynch and UBS Securities LLC are the lead banks on the deal that will be used to fund the buyout of the company by AEA Investors LP.

Garden Ridge is a Houston-based seller of mattresses, ready-to-assemble furniture, discount apparel and handbags and books.

Clement readies allocations

Clement Pappas and Co. Inc.'s oversubscribed credit facility is anticipated to allocate and close during the week of Aug. 8, according to a market source.

The $280 million facility consists of a $230 million six-year term loan B (B2) talked at Libor plus 525 bps with a 1.25% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, and a $50 million five-year ABL revolver.

Jefferies & Co. and BMO Capital Markets Corp. are the lead banks on the deal that will be used to help fund the buyout of the company by Lassonde Industries Inc. for $390 million.

Pro forma for the transaction, senior leverage is around 4.25 times.

Clement Pappas is a Carneys Point, N.J.-based producer of store brand ready-to-drink fruit juices, drinks and sauces. Lassonde is a Quebec-based developer, manufacturer and marketer of fruit and vegetable juices and drinks as well as specialty food products.

Carrols wraps deal

In other news, Carrols LLC closed on its $85 million credit facility, consisting of a $20 million revolver and a $65 million term loan, according to a news release.

Proceeds were used, along with $200 million of 8 7/8% senior secured second-lien notes, to repurchase 9% senior subordinated notes due 2013 and repay outstanding bank debt.

Carrols LLC is a subsidiary of Carrols Restaurant Group Inc., a Syracuse, N.Y.-based operator of restaurant brands in the quick-casual and quick-service segments.

Ipreo closes buyout

Kohlberg Kravis Roberts & Co. LP completed its acquisition of Ipreo Holdings LLC from Veronis Suhler Stevenson, according to a news release.

To help fund the transaction, Ipreo got a new $135 million credit facility, consisting of a $115 million term loan and a $20 million revolver, with both tranches priced at Libor plus 650 bps with a 1.5% Libor floor. The term loan was sold at an original issue discount of 98 and has 101 soft call protection for one year, and the revolver was sold at 99.

During syndication, the term loan was downsized from $150 million as the company's mezzanine debt was increased to $105 million from $70 million.

RBC Capital Markets LLC led the deal for the New York-based capital markets and corporate analytics firm.

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