Fairmount breaks; Neiman, Cablevision, MetroPCS up with numbers; Sinclair, Evertec set talk

By Sara Rosenberg

New York, Aug. 5 - Fairmount Minerals Ltd.'s credit facility allocated and freed up for trading on Thursday, with the term loan B quoted above the original issue discount price at which it was sold during syndication.

Also in trading, Neiman Marcus Inc.'s term loan was a little stronger after monthly revenues were announced, and Cablevision Systems Corp. and MetroPCS Communications Inc. both saw improvements with the release of earnings.

Over in the primary market, Sinclair Television Group Inc. and Evertec came out with price talk on their proposed bank deals as both transactions were presented to lenders during the session.

Fairmount frees to trade

Fairmount Minerals credit facility hit the secondary market on Thursday morning, with the $550 million term loan B quoted at 98¾ bid, 99¾ offered on the break and then moving up to 99¾ bid, par ¼ offered, according to traders.

Pricing on the term loan B is Libor plus 450 basis points with a step-down to Libor plus 425 bps when leverage is less than 2.75 times and after receipt of June 30, 2011 financials. There is a 1.75% Libor floor.

The original issue discount price on the term loan B was 981/2.

And, the tranche provides for 101 soft call protection for one year.

During syndication, pricing on the term loan B was reduced from initial talk of Libor plus 475 bps to 500 bps, the step-down was added and the discount firmed at the tight end of the initial 98 to 98½ guidance.

Fairmount lead banks

Fairmount Minerals' $775 million senior secured credit facility (B1/BB), which also includes a $75 million revolver and $150 million term loan A, is being led by Barclays, KeyBank, Bank of America and PNC, with Barclays the left lead.

Pricing on the revolver and term loan A is Libor plus 450 bps, with the same step-down to Libor plus 425 bps as the term loan B, effective at less than 2.75 times leverage and after receipt of June 30, 2011 financials.

Also like the term loan B, the revolver and the term loan A were sold at an original issue discount of 981/2.

The term loan A carries a 1.75% Libor floor, while the revolver has no floor.

Proceeds will be used by the Chardon, Ohio-based producer of industrial sand to help fund its buyout by American Securities.

Neiman Marcus inches up

Neiman Marcus' term loan was a touch better in trading as the company revealed a year-over-year improvement in July revenues, according to traders.

The Dallas-based high-end specialty retailer's term loan was quoted by one trader at 94 7/8 bid, 95 3/8 offered, up from 94¾ bid, 95¼ offered, and by two other traders at 95 bid, 95½ offered, up from 94½ bid, 95 offered.

For the month of July, Neiman reported total revenues of $226 million, up 13.6% from $199 million in the comparable period last year.

Comparable revenues for the month were $224 million, up 12.3% from $199 million in the prior year.

In addition, the company revealed that it made an $85 million voluntary prepayment on its senior secured term loan in July.

Cablevision rises

Cablevision, a Bethpage, N.Y.-based telecommunications, media and entertainment company, saw its term loan B-1 head higher on Thursday following the release of second-quarter results, while its term loan B-2 and B-3 were flat on the day, according to traders.

Traders had the term loan B-1 quoted at 99½ bid, par offered, up a quarter of a point on the day, the term loan B-2 at 98¼ bid, 98¾ offered, unchanged, and the term loan B-3 at 97¼ bid, 97¾ offered, also unchanged.

For the second quarter, Cablevision reported net income of $61 million, or $0.21 per share, compared to net income of $87 million, or $0.30 per share, in the prior year.

Net revenues for the quarter were $1.8 billion, up 5.8% from $1.7 billion in the second quarter of 2009.

And, consolidated adjusted operating cash flow grew 9% to $678 million from $621 million last year.

MetroPCS gains ground

Also announcing numbers was MetroPCS, and both its extended and non-extended term loan debt saw a bump up with the news, according to traders.

Two traders had the Dallas-based wireless communications service provider's extended term loan quoted at 98½ bid, 99 offered, up from 98 3/8 bid, 98 7/8 offered, and the non-extended term loan quoted at 97½ bid, 98 offered, up from 97 3/8 bid, 97 7/8 offered.

A third trader had the non-extended term loan quoted at 97½ bid, 98 offered, up from 97 1/8 bid, 97 5/8 offered.

For the second quarter, MetroPCS reported net income of $80 million, or $0.22 per diluted share, versus net income of $26 million, or $0.07 per diluted share, in the 2009 second quarter.

Total revenues for the quarter were $1.013 billion, compared to $860 million in the previous year.

And, consolidated adjusted EBITDA for the quarter was $322 million, compared to $234 million in the prior year.

Sinclair talk emerges

Switching to the primary, Sinclair Television Group held a conference call on Thursday to kick off syndication on its proposed $270 million term loan B (Ba1/BB) due October 2015, and in connection with the launch, price talk was announced, according to a market source.

The term loan B is being talked at 425 bps with a 1.5% Libor floor and an original issue discount of 991/2, the source said.

Additionally, the loan includes 101 soft call protection for one year, the source continued.

JPMorgan is the lead bank on the deal that is being marketed to existing lenders only.

Sinclair refinancing debt

Proceeds from Sinclair's term loan, along with cash and/or revolver borrowings, will be used to repay its existing $305 million term loan B that also matures in October 2015.

The existing term loan B was obtained last year when the markets were more volatile. Pricing on the existing deal is Libor plus 450 bps with a 2% Libor floor, and the tranche was sold at an original issue discount of 98.

The new term loan B is also expected to provide more incremental loan capacity and more flexible terms for usage of cash and revolver debt.

Sinclair is a Hunt Valley, Md.-based television broadcasting company.

Evertec releases talk

Evertec price talk surfaced on Thursday as well, as a bank meeting took place for its proposed $400 million senior secured credit facility, according to a market source.

Both the $50 million revolver and the $350 million term loan are being talked at Libor plus 475 bps with an original issue discount of 98, the source said.

The term loan has a 1.5% Libor floor, the source continued.

Bank of America and Morgan Stanley are the lead banks on the deal, with Bank of America the left lead.

Evertec being acquired

Proceeds from Evertec's credit facility will be used to help fund Apollo Management LP's acquisition of 51% of the company from Popular Inc.

Remaining funding for the acquisition will come from $225 million of notes, which are backed by a commitment for a senior unsecured bridge loan, and $165.75 million of equity.

Closing is expected in the third quarter.

The joint venture is valued at roughly $900 million. As part of the transaction, Popular, a San Juan. P.R., bank, transferred its merchant acquiring and processing and technology businesses to Evertec.

Evertec processes 1.1 billion transactions annually in the Caribbean and Latin America.

Pet Supplies launches

Another deal to launch with a bank meeting on Thursday was Pet Supplies Plus' proposed $120 million credit facility, according to a market source.

The deal launched as expected as a $15 million revolver, an $85 million term loan and a $20 million delayed-draw term loan, with all tranches talked at Libor plus 525 bps with a 1.75% Libor floor and an original issue discount of 98, the source said.

BNP Paribas and Societe Generale are the lead banks on the facility that will be used to help fund the buyout of the company by Irving Place Capital.

Pet Supplies Plus is a Farmington Hills, Mich.-based pet supplies store chain.

Genco kicks off retail round

Genco Distribution Systems Inc. also held a retail bank meeting on Thursday, presenting a $450 million credit facility to lenders that is largely comprised of a revolver, according to a market source.

PNC Bank and Wells Fargo are the lead banks on the deal that was already pretty well syndicated ahead of the retail launch.

Proceeds from the facility, along with about $125 million of Genco shares sold to affiliates of Greenbriar Equity Group LLC, will be used to fund the acquisition of ATC Technology Corp. for $25 per share in cash. The transaction is valued at $512.6 million.

Closing is expected during the fourth quarter, subject to stockholder approval, financing and regulatory approvals.

Genco is a Pittsburgh-based third-party provider of logistics services. ATC is a Downers Grove, Ill.-based provider of comprehensive engineered solutions for logistics and refurbishment services.

Global Brass coming along

Talk is that Global Brass and Copper Inc.'s $330 million five-year term loan (B) has been going well since launching on July 29, according to a market source.

The loan is talk at Libor plus 750 bps with a 2% Libor floor and an original issue discount of 97, and there is call protection of 105 in year one, 103 in year two and 101 in year three.

The company will also be getting a $150 million ABL revolver with the existing bank group.

Goldman Sachs is the lead bank on the deal that will be used to refinance an existing $380 million ABL revolver and $60 million term loan.

Global Brass and Copper is an East Alton, Ill.-based manufacturer and distributor of copper and copper-alloy sheet, strip, plate, foil, rod and fabricated components.

GEO Group closes

In other news, GEO Group Inc. closed on its $750 million senior credit facility (Ba3/BB+), consisting of a $400 million five-yea revolver, a $150 million five-year term loan A and a $200 million six-year term loan B, according to a news release.

Pricing on the revolver and term loan A is Libor plus 250 bps, and pricing on the term loan B is Libor plus 325 bps with a 1.5% Libor floor. The B loan was sold at an original issue discount of 99.

The spread on the revolver and the term loan A was flexed down from Libor plus 275 bps during syndication.

BNP Paribas acted as the lead bank on the deal that will be used to refinance existing debt and to help fund the acquisition of Cornell Cos. Inc. at an estimated enterprise value of $685 million, including the assumption of $300 million of Cornell debt and excluding cash.

The acquisition is expected to close on Aug. 12.

Boca Raton, Fla.-based GEO Group and Houston-based Cornell are prison operators.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.