BMC, Level 3, WS Packaging break; Alcatel, Bowie, Generic Drug, IES revisions emerge

By Sara Rosenberg

New York, Aug. 9 - BMC Software's credit facility made its way into the secondary market on Friday, with the U.S.-denominated term loans quoted above their original issue discount prices, and Level 3 Financing Inc. and WS Packaging Group Inc. freed up as well.

Switching to the primary, Alcatel-Lucent USA Inc. trimmed pricing on its U.S. term loan C, and Bowie Resources LLC set the coupon on its first-lien term loan at the wide end of talk while widening the spread and discount on its second-lien term loan.

Furthermore, Generic Drug Holdings Inc. (Harvard Drug) reduced pricing on its term loan B and shortened the soft call protection, International Equipment Solutions LLC (IES) widened the discount on its loan, and Spectrum Brands Inc. and Hubbard Radio LLC moved up the commitment deadlines on their term debt.

BMC hits secondary

BMC Software's credit facility began trading on Friday, with the $2.88 billion U.S. seven-year first-lien covenant-light term loan quoted at par bid, par 5/8 offered and the $335 million seven-year first-lien covenant-light term loan at the euro borrower quoted at 99½ bid, par ¼ offered, according to a trader.

The company's senior secured credit facility (B1/B+) also includes a $350 million five-year revolver and a €500 million seven-year first-lien covenant-light term loan.

Pricing on the U.S. term loan and the U.S. denominated term loan at the euro borrower is Libor plus 400 basis points and pricing on the euro term loan is Euribor plus 450 bps, with all of the term debt having a 1% floor and 101 soft call protection for six months, and sold at an original issue discount of 99.

During syndication, the U.S. loan was downsized from $3.2 billion, the euro loan was downsized from €750 million and the U.S. denominated term loan at the euro borrower was added to the capital structure.

BMC lead banks

Credit Suisse Securities (USA) LLC, RBC Capital Markets, Barclays, Goldman Sachs Bank USA, Deutsche Bank Securities Inc., Citigroup Global Markets Inc., Mizuho Securities USA Inc. and Jefferies Finance LLC are leading BMC's credit facility.

Proceeds will be used to help fund the buyout of the Houston-based software company by Bain Capital, Golden Gate Capital, GIC Special Investments Pte Ltd. and Insight Venture Partners for $46.25 per share in cash, or about $6.9 billion.

Other funds for the transaction will come from $1,625,000,000 of notes, upsized from $1,380,000,000 when the term loan size changes were announced.

Closing is expected later this year, subject to approval from BMC shareholders, which has been obtained, regulatory approvals and other customary conditions.

Level 3 starts trading

Level 3's $815 million senior secured term loan B-III (Ba3/BB-/BB) due Aug. 1, 2019 freed up too, with the debt seen by one source at par 3/8 bid, par ¾ offered, by a second source at par 3/8 bid, par 5/8 offered and by a third source at par ¼ bid, par 5/8 offered.

Pricing on the loan is Libor plus 300 bps, after flexing recently from Libor plus 325 bps. There is a 1% Libor floor and 101 soft call protection for six months and it was issued at par.

Bank of America Merrill Lynch and Citigroup Global Markets Inc. are the joint lead arrangers on the deal and bookrunners with Morgan Stanley Senior Funding Inc., Credit Suisse Securities (USA) LLC, Jefferies Finance LLC and J.P. Morgan Securities LLC.

Proceeds from the loan, which is expected to close on Monday, will be used to refinance an existing $815 million term loan B due Aug. 1, 2019 priced at Libor plus 375 bps with a 1.5% Libor floor.

Level 3 is a Broomfield, Colo.-based provider of fiber-based communications services.

WS Packaging tops OID

WS Packaging Group's credit facility also broke, with the $236 million six-year first-lien term loan quoted at par bid, par ½ offered, according to a market source.

Pricing on the term loan, as well as on a $40 million five-year revolver, is Libor plus 400 bps with a 1% Libor floor and the debt was sold at an original issue discount of 991/2. The term loan has 101 soft call protection for six months.

Earlier this month, pricing on the facility was lowered from Libor plus 425 bps as the deal was well received by investors.

GE Capital Markets is the lead on the $276 million credit facility (B1/B+) that allocated late Thursday but didn't start trading until Friday.

Proceeds will be used to refinance existing debt, including bank borrowings and mezzanine debt.

WS Packaging is a Green Bay, Wis.-based manufacturer of pressure-sensitive labels.

Alcatel cuts spread

Over in the primary, Alcatel-Lucent USA lowered the coupon on its $1,741,250,000 term loan C to Libor plus 475 bps from Libor plus 500 bps, and left the 1% Libor floor, par offer price and 101 soft call protection for six months intact, according to a market source.

Meanwhile, the €298.5 million term loan D was unchanged at Euribor plus 525 bps with a 1% floor, a par offer price and 101 soft call protection for six months.

Recommitments were due at noon ET on Friday, the source remarked.

Morgan Stanley Senior Funding Inc., Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc. are leading the deal that will be used to reprice the existing term loan C from Libor plus 625 bps with a 1% Libor floor and the existing term loan D from Euribor plus 650 bps with a 1% Euribor floor.

Alcatel is a Paris-based telecommunications services and equipment company.

Bowie reworked again

Bowie Resources set pricing on its $335 million first-lien term loan B (B1/B+) at Libor plus 575 bps, the high end of revised talk of Libor plus 550 bps to 575 bps and up from initial talk of Libor plus 500 bps to 525 bps, according to a market source, who said the 1% Libor floor, original issue discount of 97 and 101 soft call protection for one year were unchanged.

In addition, pricing on the $100 million second-lien term loan (Caa1/CCC+) was raised to Libor plus 1,075 bps from revised talk of Libor plus 950 bps to 975 bps and initial talk of Libor plus 875 bps to 900 bps, and the original issue discount was moved to 96 from revised talk of 97 and initial talk of 98, the source remarked. The debt still has a 1% floor and is non-callable for one year, then at 102 in year two and 101 in year three.

When the first round of pricing changes was announced earlier this month, the discount on the first-lien term loan was modified from 99, the second-lien term loan was downsized from $121 million and the call protection on the second-lien loan was sweetened from 103 in year one, 102 in year two and 101 in year three.

Bowie getting revolver

Bowie Resources' $470 million credit facility, for which recommitments were due at noon ET on Friday, also includes a $35 million ABL revolver.

Morgan Stanley Senior Funding Inc. and Deutsche Bank Securities Inc. are leading the deal that will be used to help fund the $435 million acquisition of Canyon Fuel Co. LLC from Arch Coal Inc., and the funds lost from the recent second-lien term loan downsizing are being replaced with $21 million of Caterpillar Lease Financing.

With the transaction, Galena Private Equity Resources Fund will provide a cash investment to acquire a minority equity stake in Bowie.

Closing is expected in the third quarter, subject to governmental and regulatory approvals and other customary conditions.

Bowie Resources is a Louisville, Ky.-based coal company.

Generic flexes lower

Generic Drug revised pricing on its $380 million senior secured term loan B (B1/B) to Libor plus 400 bps from talk of Libor plus 425 bps to 450 bps and shortened the 101 soft call protection to six months from one year, according to a market source. The 1% Libor floor and original issue discount of 99 were unchanged.

Commitments are due at noon ET on Monday, moved up from the original Wednesday deadline, the source said.

Morgan Stanley Senior Funding Inc., Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc. are leading the loan that will be used to refinance existing debt and pay a dividend to shareholders.

Generic Drug is a Livonia, Mich.-based independent pharmaceutical distributor.

IES updates discount

International Equipment Solutions moved the original issue discount on its $270 million six-year term loan B (B2/B+) to 98½ from 99, a market source said.

Pricing on the loan is still Libor plus 550 bps with a 1.25% Libor floor, and there is 101 soft call protection for one year.

Bank of America Merrill Lynch, J.P. Morgan Securities LLC and PNC Capital Markets LLC are leading the deal that will be used to refinance existing debt.

International Equipment is an Oak Brook, Ill.-based manufacturer of highly engineered cab enclosures and attachment tools.

Spectrum shutting early

Spectrum Brands accelerated the commitment deadline on its $1.1. billion in first-lien covenant-light term loans (NA/NA/BB-) to 2 p.m. ET on Monday from 5 p.m. ET on Tuesday as a result of oversubscription, according to a market source.

The debt consists of a $700 million four-year tranche talked at Libor plus 250 bps and a $400 million six-year tranche talked at Libor plus 300 bps, with both having a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year.

The four-year loan has amortization of 7.5% per annum and the six-year loan has amortization of 1% per annum.

Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc. are leading the deal that will be used to fund a tender offer for the company's $950 million of 9.5% senior secured notes due 2018.

The tender expires on Sept. 3.

Spectrum Brands is a Madison, Wis.-based consumer products company.

Hubbard revises deadline

Hubbard Radio moved up the commitment deadline on its $63.5 million add-on delayed-draw term loan B (B1) due April 29, 2019 to noon ET on Monday from Thursday, according to a market source.

The add-on is talked at Libor plus 350 bps with a 1% Libor floor and an original issue discount of 99, and has a ticking fee of half the spread for the first 30 days and the full spread thereafter.

The delayed-draw period is for eight months from close and the debt is available in two separate borrowings, subject to maximum pro forma first-lien leverage of 4.75 times.

Morgan Stanley Senior Funding Inc. is leading the deal that will help fund the acquisition of 10 radio stations from Sandusky Radio for about $85.5 million.

Closing is expected upon Federal Communications Commission approval and other customary conditions.

Hubbard Radio is a Minneapolis-St. Paul, Minn.-based operator of radio stations.

American Greetings closes

In other news, American Greetings Corp.'s buyout by the Weiss Family for $19.00 per share in cash has been completed, a news release said.

For the transaction, American Greetings got a new $600 million senior secured credit facility (Ba2/BB-) that consists of a $350 million term loan and a $250 million revolver.

Pricing on the term loan is Libor plus 325 bps with a 0.75% Libor floor and it was sold at an original issue discount of 991/2, and pricing on the revolver is Libor plus 300 bps with an upfront fee that ranged from 20 bps to 50 bps.

During syndication, the term loan was downsized from $400 million and the revolver was upsized from $200 million.

Bank of America Merrill Lynch, Deutsche Bank Securities Inc., PNC Capital Markets LLC, KeyBank and Macquarie Capital (USA) Inc. led the deal.

American Greetings is a Cleveland-based greeting card company.

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