Booz Allen timing reverts to undecided; Getty pricing estimations emerge; GM, Ford, US Airways slide

By Sara Rosenberg

New York, June 6 - Booz Allen Hamilton Inc.'s U.S. Government Consulting Business will not be holding a bank meeting for its credit facility on Wednesday as was previously hoped, and the new potential timing on the launch is still to be determined.

Also in primary happenings, some chatter from investors surrounding expected pricing on Getty Images Inc.'s credit facility has been making its way around the market as the deal is getting ready to launch on Tuesday.

Moving to the secondary market, things were rather quiet and, for the most part, levels held in okay despite the drop in equities on Friday. However, General Motors Corp., Ford Motor Co. and US Airways Group Inc. did soften on some selling pressure.

Booz Allen U.S. Government Business is not going to launch its $810 million credit facility to retail investors on Wednesday - the previously penciled in bank meeting date - and the launch isn't expected to happen any day next week either, a market source told Prospect News on Friday.

As to when the launch might take place, the source said that it's completely up in the air at this point.

Proceeds from the credit facility will be used to help fund the buyout of the company by Carlyle Group for $2.54 billion.

Timing of the retail launch is tied up in the timing of the closing of the buyout, the source said in explanation of why the hoped for Wednesday bank meeting will not be taking place. The buyout has to close at the end of a month, so it could either close at the end of June or at the end of July. It's hoped that the close won't go past July.

The deal, however, has been in pre-marketing for about a week and that process is "going pretty well" as some orders have already come in, the source added.

The credit facility consists of a $100 million revolver, a $250 million term loan A and a $460 million seven-year term loan B.

Price talk on the tranches is not yet available.

Bank of America, Credit Suisse and Lehman Brothers are the joint lead arrangers and joint bookrunners on the deal.

Other acquisition financing will come from $550 million of eight-year mezzanine debt.

Leverage through the bank deal will be around the low-3s and total leverage will be around the mid-5s.

The transaction is subject to shareholder and regulatory approvals and other customary closing conditions.

The U.S. government business, based in McLean, Va., has more than 18,000 employees in 80 offices worldwide, generating annual net revenues in excess of $2.7 billion.

Getty guidance projections float around

Some discussion over Getty Images' potential price talk has started circulating as investors are getting ready for the deal's Tuesday bank meeting; however, official pricing guidance has not yet been announced, according to a market source.

Talk is that lenders are showing some interest in the $705 million seven-year term loan and the $265 million 40-day delayed-draw, seven-year final maturity, term loan in the Libor plus 425 basis points area at an original issue discount of 97, the source said. The debt has a Libor floor of 3.25%.

By comparison, according to filings with the Securities and Exchange Commission, pricing on the term loan debt was said to be expected at Libor plus 450 bps.

What is pretty much known for sure is that price talk will be in the Libor plus 400s context, the source continued.

The delayed-draw and the funded term loan are basically going to be marketed as a single $970 loan.

Getty Images' $1.045 billion senior secured credit facility also includes a $75 million five-year revolver. Price talk on this tranche is also rumored to be around Libor plus 425 bps, although SEC filings have put it at Libor plus 450 bps, the source added.

Both the revolver and the delayed-draw term loan have a 50 bps commitment fee.

Financial covenants include a maximum total leverage ratio and a minimum consolidated interest coverage ratio.

The facility has a $100 million accordion feature.

Barclays, GE Capital and RBS Securities are the joint bookrunners on the deal, with Barclays and GE acting as co-lead arrangers. GE is the administrative agent.

Proceeds will be used to help fund the buyout of the company by Hellman & Friedman LLC for $34 per share in cash. The transaction is valued at $2.4 billion, including the assumption of existing debt.

Other financing will come from up to $941.3 million in equity.

Completion of the transaction is expected to occur in the second quarter, subject to shareholder approval and other customary closing conditions. The deal is not subject to a financing condition.

A special meeting of shareholders is scheduled to take place on June 20.

Getty Images is a Seattle-based creator and distributor of still imagery, footage and multi-media products, and a provider of other forms of digital content.

GM, Ford, US Airways inch lower

Switching to trading news, General Motors, Ford and US Airways all saw their term loan levels weaken during a very light and quiet Friday session as more sellers than buyers emerged in those specific names, according to a trader.

General Motors, a Detroit-based automotive company, saw its term loan quoted at 88 bid, 89 offered, down from 88¾ bid, 84½ offered, the trader said.

Ford, a Dearborn, Mich.-based automotive company, saw its term loan quoted at 86 bid, 86 3/8 offered, down from 86 3/8 bid, 86 5/8 offered, the trader continued.

And, US Airways, a Tempe, Ariz.-based airline company, saw its term loan quoted at 69½ bid, 70½ offered, down from 70½ bid, 71½ offered.

All the other airlines, like UAL Corp., Northwest Airlines Corp., Delta Air Lines Inc. and AMR Corp. were basically unchanged on the day.

"Despite abysmal performance in stocks, we held in okay. Barring autos, things would have been better. [Autos] just framed lower because of equities and oil," the trader remarked.

The trader went on to say that volumes were very low, so that even a small trade in General Motors, Ford or US Airways would have moved the market lower.

On Friday, Nasdaq ended the day down 75.38 points, or 2.96%, Dow Jones Industrial Average ended the day down 394.64 points, or 3.13%, S&P 500 ended the day down 43.37 points, or 3.09% and NYSE ended the day down 255.98 points, or 2.72%.

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