Crown Castle, Genesys break; Realogy extended loan rallies; Kodak, Community Health tweak

By Sara Rosenberg

New York, Jan. 25 - Crown Castle Operating Co. and Genesys hit the secondary market on Wednesday, with their term loan Bs quoted above their original issue discount prices, and Realogy Corp.'s bank debt was noticeably stronger after word of a paydown surfaced.

In more happenings, Eastman Kodak Co. tightened the original issue discount on its term loan, and Community Health Systems Inc. revised its credit facility amendment and extension offer, sweetening fees so as to get more investors on board with extending their commitments.

Also, Caribbean Restaurants LLC came out with price talk on its credit facility as the deal was presented to lenders during the session, and U.S. Security Associates Inc. released original issue discount guidance on its in market add-on term loan.

Furthermore, Attachmate Group emerged with incremental loan and amendment plans, and EMI Music Publishing nailed down timing on the launch of its buyout credit facility.

Crown Castle frees up

Crown Castle's new credit facility started trading on Wednesday, with the $1.6 billion seven-year term loan B quoted by one trader at 99¾ bid, par offered on the break and then move up to par bid, par 3/8 offered. A second trader saw it break at the same level, but he was quoting it at 99 7/8 bid, par 1/8 offered.

Pricing on the B loan is Libor plus 300 basis points with a 1% Libor floor, and it was sold at an original issue discount of 99. There is 101 soft call protection for one year.

During syndication, the spread on the term loan B was flexed down from Libor plus 325 bps.

The company's $3.1 billion senior secured credit facility (Ba3/B+/BB+) also includes a $1 billion five-year revolver and a $500 million five-year delayed-draw term loan A that can be drawn on or before April 1, both priced at Libor plus 250 bps.

Upfront fees on the revolver and term loan A were 25 bps for a $25 million commitment and 37.5 bps for more than $25 million. The term loan A also has a 50 bps delayed-draw fee.

Crown Castle lead banks

Bank of America Merrill Lynch, RBS Securities Inc. and Morgan Stanley & Co. LLC are leading the Crown Castle deal that is expected to close this quarter, with Bank of America left lead on the B loan and RBS left lead on the pro rata.

Proceeds from Crown Castle's credit facility will be used to fund the roughly $1 billion acquisition of NextG Networks Inc. and to refinance existing revolver and term loan borrowings.

Any remaining proceeds from the transaction will be available for general corporate purposes, including acquisitions and purchases of shares of common stock.

NextG, a Milpitas, Calif.-based provider of outdoor distributed antenna systems, is being bought from a group of investors led by Madison Dearborn Partners and includes Accel Partners, Redpoint Ventures and Meritech Capital Partners.

Crown Castle is a Houston-based owner, operator and leaser of towers and other infrastructure for wireless communications.

Genesys tops OID

Another deal to free up was Genesys, with the $575 million seven-year covenant-light term loan B quoted by one trader at 99 bid, par offered on the break and then at 99¾ bid, par ½ offered quickly thereafter. Meanwhile, a second trader was quoting it at par bid.

Pricing on the term loan B is Libor plus 525 bps 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, the loan was upsized from $550 million, the spread firmed at the low end of the Libor plus 525 bps to 550 bps talk and the leverage and interest coverage covenants were removed.

The company's $625 million credit facility (Ba3) also provides for a $50 million five-year revolver.

Genesys being acquired

Proceeds from Genesys' credit facility will be used, along with about $200 million of mezzanine debt and over 50% equity, to fund its roughly $1.5 billion buyout by Permira from Alcatel-Lucent.

The mezzanine financing was downsized from $225 million with the term loan B upsizing.

Closing is expected early this year, subject to review by the Committee of Foreign Investment in the United States and other customary regulatory approvals and consultations in various countries.

Goldman Sachs & Co., Citigroup Global Markets Inc., RBC Capital Markets LLC and Macquarie Capital are the lead banks on the deal.

Genesys is a Daly City, Calif.-based supplier of contact center technology software.

Realogy rises

Realogy's bank debt headed higher on Wednesday as the company announced that it will be repaying some of its loans with proceeds from a $918 million bond offering, according to a trader.

The extended strip was quoted at 93½ bid, 94 offered, up from 90¼ bid, 91¼ offered on the open and 90½ bid, 91½ offered in the previous session, and the second-lien loan was quoted at 102¾ bid, 103¾ offered, up from 101¾ bid, 102¾ on the open and 102¼ bid, 103¼ offered on Tuesday, the trader said.

Specifically, proceeds from the notes - split between $593 million of senior secured first-lien debt and $325 million of senior secured half-lien debt - will be used to pay down $629 million of first-lien term loans due in October 2013, all $133 million drawn under the non-extended revolver due in April 2013 and $156 million drawn under the extended revolver due in April 2016.

In conjunction with the revolver repayment, the Parsippany, N.J.-based provider of real estate and relocation services will reduce its revolver size by the equivalent amount.

Kodak revises OID

Moving to the primary, Kodak moved the original issue discount on it $700 million term loan to 98, compared to talk at launch of 97 to 97½ and early guidance of 97, according to a market source.

Pricing on the loan remained at Libor plus 750 bps with a 1% Libor floor, which is where it launched on Monday but considerably tighter than the early guidance of Libor plus 850 bps with a 1.5% Libor floor that began circulating last week.

The company's $950 million 18-month debtor-in-possession credit facility also includes a $250 million revolver priced at Libor plus 325 bps.

Citigroup Global Markets Inc. is the lead bank on the deal that will be used to enhance liquidity and working capital.

Kodak, a Rochester, N.Y.-based provider of imaging technology products and services to the photographic and graphic communications markets, expects to exit Chapter 11 in 2013.

Community Health reworks fees

Community Health Systems came out with modifications to its amendment and extension offer, moving the consent fee to 17.5 bps from 12.5 bps and the extension fee to 25 bps from no fee, according to a market source.

Also, the choice for one- and two-month Libor was eliminated on all extended loans, leaving the company with the option of only three-month Libor on the extended debt.

Pricing on the proposed extended debt was left unchanged at Libor plus 350 bps. Non-extended pricing is Libor plus 225 bps.

The company is still looking to extend a minimum of $2 billion of its non-extended term loan to January 2017 from June 2014. However, it was made clear to lenders that if less than $2 billion comes in for extension, the company will evaluate whether it wants to move forward with the transaction or not, and if $2 billion or more comes in, the company will accept at least $2 billion for extension.

Community revises deadline

With the changes, Community Health decided to give lenders until noon ET on Thursday to place their orders and give consents, the source remarked. Originally, the deadline had been set for Wednesday.

Credit Suisse Securities (USA) LLC is the lead arranger on the deal that is hoped to be closed by the end of the month or shortly thereafter.

Under the terms of the credit facilities, a majority of all lenders is needed to approve the proposed amendment for the company to do an extension. The source explained that the amendment itself is in good shape, but the extension is where interest needs to be generated.

Following the updates, one trader had the company's bank debt flat in trading, with the non-extended loan quoted at 98¾ bid, 99¼ offered, and the extended loan quoted at 98½ bid, 99½ offered.

Community Health is a Nashville, Tenn.-based operator of hospitals.

Caribbean discloses guidance

In more deal news, Caribbean Restaurants held a bank meeting on Wednesday afternoon to kick off syndication on its proposed $210 million credit facility, and in connection with the launch, price talk was announced, according to a market source.

Both the $20 million revolver and the $190 million term loan are talked at Libor plus 800 bps with a 1.5% Libor floor and an original issue discount of 97, and the term loan has soft call protection of 102 in year one and 101 in year two, the source remarked.

Lead bank Jefferies & Co. is seeking commitments by Feb. 8.

Proceeds will be used by the operator of Burger King restaurants in Puerto Rico to refinance existing bonds.

U.S. Security OID talk

U.S. Security Associates came out with original issue discount talk on its $40 million add-on term loan at 98½ to 99, according to a market source. When the deal launched on Tuesday, investors were told that the discount was still to be determined.

Pricing on the add-on loan matches existing term loan pricing at Libor plus 475 bps with a 1.25% Libor floor. When obtained last year, the existing loan was sold at a discount of 99.

Goldman Sachs & Co. is the lead bank on the deal that will be used to fund an acquisition.

U.S. Security Associates is a Roswell, Ga.-based security firm.

Attachmate readies deal

Attachmate will be holding a conference call on Thursday to launch $400 million of incremental term loans that will be used to fund a dividend, as well as an amendment to its existing credit facility to allow for the new debt and the use of proceeds, a market source told Prospect News.

The new debt consists of a $300 million first-lien term loan due April 27, 2017 talked at Libor plus 575 bps and a $100 million second-lien term loan due Oct. 27, 2017 talked at Libor plus 900 bps. Both tranches have a 1.5% Libor floor and are being offered at an original issue discount of 98, the source said.

And, with the amendment, existing first-lien term loan pricing will move to Libor plus 575 bps from Libor plus 500 bps and existing second-lien loan pricing will move to Libor plus 900 bps from Libor plus 800 bps, the source continued. The existing loans include a 1.5% Libor floor, and were sold at a discount of 99 last year.

Call protection on the incremental debt matches the existing loans. The call protection on the second-lien loan is 103 in year one, 102 in year two and 101 in year three.

Attachmate offers fees

For consents towards the amendment, Attachmate will pay first-lien lenders 25 bps and second-lien lenders 50 bps.

Commitments towards the new debt and amendment consents are due on Feb. 6.

Credit Suisse Securities (USA) LLC, RBC Capital Markets LLC, Bank of America Merrill Lynch and Wells Fargo Securities LLC are the lead banks on the deal.

Following the news of the incremental loans and amendment, Attachmate's bank debt was unchanged in the secondary market, with one trader quoting the first-lien term loan at 99½ bid, par offered and a second trader quoting it at 99 bid, par offered. The second-lien loan was quoted at 96½ bid, 98½ offered, the first trader added.

Attachmate is a Seattle-based provider of access and integration software for legacy systems.

EMI firms launch

EMI Music Publishing zeroed in on timing for its proposed $1.125 billion senior secured credit facility with the scheduling of a bank meeting for 10 a.m. ET on Friday in New York, according to a market source, who said that the deal has good momentum headed into the launch.

As was previously reported, the facility consists of a $1.05 billion term loan B and a $75 million revolver. Price talk is not yet available, the source remarked.

UBS Securities LLC is the leading the deal that will be used to fund the purchase of the company for total consideration of $2.2 billion from a wholly owned subsidiary of Citigroup Inc.

The group buying the company includes Sony/ATV Music Publishing, a subsidiary of Sony Corp. of America that is co-owned by trusts formed by the Estate of Michael Jackson, Mubadala Development Co. PJSC, Jynwel Capital Ltd., GSO Capital Partners LP and David Geffen.

EMI Music Publishing is a music publisher. Sony/ATV is a New York-based owner and administrator of copyrights by artists.

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