Secondary, primary activity light in pre-holiday market; Alcatel and NFR on tap for January

By Sara Rosenberg

New York, Dec. 24 - The market was quiet ahead of the holidays, with little trading and no primary activity seen, but investors are expecting things to pick up in January. As of now, though, the only confirmed business for next month is Alcatel-Lucent and NFR Energy LLC.

Alcatel Lucent is set to hold a bank meeting on Jan. 8 in London and on Jan. 9 in New York to launch a €1,615,000,000-equivalent credit facility that went through a pre-marketing stage in December.

The facility consists of a $500 million 31/2-year term loan talked at Libor plus 600 basis points with a 1.25% Libor floor, a $1,275,000,000 six-year term loan talked at Libor plus 700 bps with a 1.25% Libor floor and a €250 million six-year term loan talked at Euribor plus 700 bps with a 1.25% floor.

All tranches are being offered at an original issue of 98.

The 31/2-year term loan has 101 soft call protection for one year, and the six year loans are non-callable for one year, then at 102 in year two and 101 in year three.

Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. are leading the deal that will be used to refinance existing debt and for general corporate purposes.

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

NFR readies deal

NFR Energy is also anticipated to launch in January, however a specific date is not yet available, according to a market source.

The company will approach the market with a $500 million senior secured covenant-light second-lien term loan (Caa1/B) due Dec. 31, 2018 that has call protection of 102 in year one and 101 in year two for any debt refinancing and no amortization.

The loan has a springing maturity tied to the company's 9¾% senior notes due 2017 and a $150 million accordion feature subject to 50 basis points MFN protection.

Bank of America Merrill Lynch, Citigroup Global Markets Inc. and Natixis underwrote the deal.

Proceeds, along with equity, were used by the company to fund the acquisition of TLP Energy LLC for $655 million and certain Eagle Ford Shale assets from two independent oil and gas companies for $81 million.

NFR Energy, a Houston-based independent energy company, is in the process of changing its name to Sabine Oil & Gas LLC.

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