WideOpenWest, Endurance break; Cengage retreats; Tribune gains; Kloeckner accelerated

By Sara Rosenberg

New York, July 12 - WideOpenWest Finance LLC's credit facility made its way into the secondary market on Thursday after the original issue discount on the first-lien term loan finalized tight of revised talk, and Endurance International Group (EIG Investors Corp.) broke too.

Also in trading, Cengage Learning Acquisitions Inc.'s extended and non-extended term loans were weaker on the back of the release of preliminary fiscal fourth quarter results, and Tribune Co.'s debt continued to rise on an expected ruling on its reorganization.

Moving to the primary, Kloeckner Holdings SCA moved up the commitment deadline on its credit facility due to strong demand, and BSN Medical nailed down the coupon on its U.S. term loan at the low end of talk while tightening the original issue discount.

In addition, Cheniere Energy Partners LP pulled its term loans Bs from market, and will instead get a term loan A at Sabine Pass Liquefaction LLC, Engility Corp. set pricing on its loan at the low end of guidance, and Booz Allen Hamilton Inc., Connolly Inc. and Ipreo Holdings LLC released price talk with their launches.

Furthermore, SuperValu Inc. came out with timing and structure on its proposed credit facility, Patriot Coal Corp. is anticipated to bring its debtor-in-possession facility to market next week, and The Pantry Inc. and Blue Buffalo Co. revealed new deal plans.

WideOpenWest frees up

WideOpenWest's credit facility broke for trading on Thursday, with the $1.92 billion six-year first-lien term loan B quoted at 97½ bid, 98 offered on the open and then it moved up to 98½ bid, 98 7/8 offered, according to a trader.

Pricing on the term loan B is Libor plus 500 basis points with a 1.25% Libor floor, and it was sold at an original issue discount of 96. There is 101 soft call protection for one year.

During syndication, the maturity was shortened from seven years and the discount underwent a few changes. At launch, the discount was talked at 981/2, it was then moved to 95 on Tuesday and to 95¾ to 96 on Thursday morning, before firming at the final level.

Credit Suisse Securities (USA) LLC, Morgan Stanley Senior Funding Inc., RBC Capital Markets, SunTrust Robinson Humphrey Inc. and Bank of Tokyo-Mitsubishi-UFJ Ltd. are the lead banks on the $2.12 billion credit facility (B1/B), which also provides for a $200 million five-year revolver.

WideOpenWest buying Knology

Proceeds from WideOpenWest's credit facility, $1.02 billion of notes and around $200 million of equity will fund the purchase of Knology Inc. for $19.75 per share in cash, or about $1.5 billion.

The notes consist of a $725 million seven-year senior tranche, upsized from $700 million, that priced at 10¼% and issued at par and a $295 million 71/4-year senior subordinated tranche, downsized from $320 million, that priced at 13¾% and issued at around 98.337.

WideOpenWest, an Avista Capital Partners portfolio company, is a Denver-based provider of residential and commercial high-speed internet, cable television and telephone services. Knology is a West Point, Ga.-based provider of interactive communications and entertainment services.

Endurance starts trading

Endurance's term loans freed up as well, with the $135 million first-lien term loan (B1/B) due April 2018 quoted at 99½ bid, par ¼ offered, and the $140 million second-lien term loan (Caa1/CCC+) quoted at par bid, according to one trader. A second trader was seeing the first-lien at 99½ bid, par offered.

Pricing on the first-lien term loan is Libor plus 625 bps with a 1.5% Libor floor, and it was sold at an original issue discount of 99. There is 101 soft call protection to April 2013.

The second-lien term loan is Libor plus 950 bps with a 1.5% floor, and it was sold at a discount of 98. There is call protection of 103 in year one, 102 in year two and 101 in year three.

During syndication, the first-lien term loan was upsized from $100 million and the discount was cut from 98, and the second-lien term loan was upsized from $125 million.

Credit Suisse Securities (USA) LLC, Morgan Stanley Senior Funding Inc. and Goldman Sachs & Co. are leading the loans that will fund the purchase of HostGator, a Houston-based provider of web hosting service, by Endurance, a Burlington, Mass.-based provider of web hosting and online services.

Cengage softens

Cengage Learning's term loans headed lower in trading as the company came out with preliminary estimated results for the fiscal fourth quarter late in the prior session, according to a trader.

The extended term loan was quoted at 87 bid, 88 offered, down from 88½ bid, 89 offered, and the non-extended term loan was quoted at 92¾ bid, 93¾ offered, down from 93½ bid, 94 offered, the trader said.

Revenue for the quarter is estimated to be between $499 million and $505 million, compared to $473 million for the same period in the prior year.

Adjusted EBITDA for the quarter is estimated at $187 million to $193 million, versus $202 million in the fiscal 2011 fourth quarter.

The company plans to hold a conference call in early August to discuss its results.

Cengage is a Stamford, Conn.-based provider of teaching, learning and research services for the academic, professional and library markets.

Tribune continues climb

Tribune loans were once again higher in the secondary market as investors are still reacting to news that the judge on its bankruptcy case will have a final opinion by Friday on the reorganization plan, according to a trader.

The Chicago-based media company's term loan B was quoted at 68¾ bid, 69½ offered, up from 68¼ bid, 69¼ offered, the incremental loan and term loan X were quoted at 67¾ bid, 68¾ offered, up from 67¼ bid, 68¼ offered, and the revolver was quoted at 73 bid, 75 offered, up from 72½ bid, 74½ offered, the trader said.

Under the plan, the company would transfer its broadcast licenses to a new ownership group that includes senior creditors Oaktree Capital Management, Angelo, Gordon & Co. and JPMorgan Chase.

Tribune hopes that it will be able to emerge from Chapter 11 by the end of the year.

Kloeckner revises deadline

Switching to the primary, Kloeckner Holdings accelerated the commitment deadline on its credit facility to 2 p.m. ET on Friday from 5 p.m. ET on Monday since the deal has been well received by investors, a market source told Prospect News.

The $500 million facility (Ba3/B) consists of a $65 million revolver, and a $435 million term loan that is talked at Libor plus 575 bps with a 1.25% Libor floor and an original issue discount of 98 to 981/2.

Jefferies & Co. is leading the deal that will help fund the company's recently completed recapitalization, under which it got the new debt facilities underwritten and funded by Jefferies and €190 million of cash equity from a group of new investors led by Strategic Value Partners LLC.

Other funds for the transaction will come from €255 million of second-lien notes.

Kloeckner repays debt

Kloeckner Holdings used the new debt and equity to repay in full €800 million of first-lien senior secured credit facilities at par plus accrued interest.

Through the transaction, total debt has been reduced to €630 million from €1.26 billion with the equity infusion and the exchange of second-lien and mezzanine debt for equity.

Leverage is about 4.5 times, down from around 9 times previously.

As a result of the recapitalization, Kloeckner is now owned by the Strategic Value Partners investor group.

Kloeckner is a Montabaur, Germany-based producer of films for pharmaceutical, medical device, food, electronics and general-purpose thermoform packaging, as well as printing and specialty applications.

BSN reworks pricing

BSN Medical set pricing on its $280 million term loan B-1 at Libor plus 475 bps with a 1.25% Libor floor and an original issue discount of 991/2, compared to initial talk of Libor plus 475 bps to 500 bps talk with a 1.25% floor and discount of 97 to 98, a source said.

The loan continues to have 101 soft call protection for one year.

The company's roughly €865 million credit facility also provides for a €50 million revolver, a €75 million capex/acquisition facility A, and a €514.5 million term loan B-2.

Deutsche Bank Securities Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC and Morgan Stanley Senior Funding Inc. are leading the deal, that along with €391 million of mezzanine debt. Will fund the roughly €1.8 billion buyout of the company by EQT VI from Montagu Private Equity

BSN is a Hamburg, Germany-based supplier of wound care, compression therapy and orthopedic products.

Cheniere opts for A loan

Cheniere Energy, a Houston-based energy company, decided to remove from syndication its $1.25 billion seven-year senior secured term loan B (Ba3) at Sabine Pass Liquefaction LLC and its $750 million 61/2-year senior secured term loan B (B1/B+) at Cheniere Partners, according to a news release.

Instead, Sabine Pass will get a new seven-year term loan A to fund the costs of developing, constructing and placing into service the first two liquefaction trains of the Sabine Pass LNG liquefaction project.

Meanwhile, the acquisition of the Creole Trail Pipeline from Cheniere Energy Inc. that the Cheniere Partners term loan B would have funded has been postponed until after construction begins and financing for the purchase has been obtained, the release said.

Cheniere A loan pricing

Cheniere's Sabine Pass term loan A, for which $3.4 billion of firm commitments has been received and $200 million of additional commitments is in process, is expected to be priced at Libor plus 350 bps during construction and Libor plus 375 bps during operations.

By comparison, the Sabine Pass term loan B that was pulled had been talked at Libor plus 425 bps with a 1.25% Libor floor and an original issue discount of 95, and the Cheniere term loan B that was pulled had been talked at Libor plus 550 bps with a 1.25% floor and a discount of 95. Both loans were going to be non-callable for two years, then at 102 in year three and 101 in year four.

In the release, Cheniere said that commitments for the term loan A were received from all of the previously announced joint lead arrangers and from additional banks and financial institutions.

Credit Suisse Securities (USA) LLC, SG Americas Securities LLC, Bank of Tokyo-Mitsubishi UFJ, Credit Agricole Securities (USA) Inc., HSBC Securities (USA) Inc., J.P. Morgan Securities LLC, Morgan Stanley Senior Funding Inc. and RBC Capital Markets LLC leading the term loan Bs.

Engility firms spread

Engility finalized the coupon on its $335 million term loan at Libor plus 450 bps, the low side of the Libor plus 450 bps to 500 bps talk, according to a market source. There is a 1.25% Libor floor and an original issue discount of 99.

Earlier, the term loan was upsized from $200 million as the company withdrew plans for a $250 million senior notes offering.

The company's $400 million senior secured deal (Ba1/BB+) also includes a $65 million revolver priced at Libor plus 450 bps that was increased from a revised size of $50 million, but is down from the original amount of $100 million.

Bank of America Merrill Lynch and Barclays Capital Inc. are leading the deal that will pay a dividend to L-3 Communications Holdings Inc., from which Engility is being spun off.

Engility is a Billerica, Mass.-based provider of systems engineering and technical assistance, explosive ordnance disposal/counter-IED technical support, acquisition support and NextGen services.

Booz Allen reveals talk

Also on the new deal front, Booz Allen Hamilton held a bank meeting on Thursday to kick off syndication on its credit facility, and with the launch, talk on the $1.25 billion term loan B was announced at Libor plus 375 bps to 400 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, according to a market source.

Talk on the company's $500 million revolver and $500 million term loan A had already surfaced on Wednesday at Libor plus 275 bps.

Bank of America Merrill Lynch and Credit Suisse Securities (USA) LLC are the joint lead arrangers on the $2.25 billion senior secured credit facility, and bookrunners with Credit Suisse Securities (USA) LLC, Barclays Capital Inc., Citigroup Global Markets Inc., HSBC Securities (USA) Inc., J.P. Morgan Securities LLC, Morgan Stanley Senior Funding Inc. and SMBC.

Booz Allen refi/dividend

Proceeds from Booz Allen's credit facility will be used to refinance about $959 million of senior secured credit facility debt and fund a special dividend to stockholders of up to $1 billion.

Other funds for the transaction will come from around $260 million of cash on hand.

Booz Allen Hamilton is a McLean, Va.-based provider of management and technology consulting services to the U.S. government in the defense, intelligence and civil markets.

Connolly guidance

Connolly also held a bank meeting during the session, and price talk on its $240 million first-lien term loan (Ba3) came out at Libor plus 550 bps with a 1.25% Libor floor and an original issue discount of 99, sources said. There is 101 soft call protection for one year.

The company's $130 million second-lien term loan (Caa1) is being talked at Libor plus 925 bps with a 1.25% floor and a discount of 98, sources continued. There is call protection of 103 in year one, 102 in year two and 101 in year three.

Commitments are due on July 20.

The company's $400 million credit facility, which also includes a $30 million revolver (Ba3) and is being led by RBC Capital Markets LLC and SunTrust Robinson Humphrey Inc., will fund the company's buyout by Advent International in a transaction that is expected to close this month.

Connolly, an Atlanta-based provider of technology-enabled recovery audit services, will have first-lien leverage of 3.97 times and second-lien leverage of 6.13 times.

Ipreo pricing

Ipreo launched with a call a $35 million covenant-light incremental term loan that is talked at Libor plus 650 bps with a 1.5% Libor floor, an original issue discount of 98 and 101 soft call protection for six months, according to a market source.

Lead bank, RBC Capital Markets LLC, is seeking commitments by July 19.

Proceeds will be used to refinance mezzanine debt.

The loan will not be fungible with the existing first-lien term loan that carries the same pricing.

To company is asking to amend its existing credit facility to allow for the new debt, and lenders are being offered a 25 bps consent fee, the source remarked.

Ipreo is a New York-based capital markets and corporate analytics firm.

SuperValu details emerge

SuperValu scheduled a bank meeting for 9:30 a.m. ET on Friday to launch its proposed credit facility, which surfaced with a size of $2.5 billion, according to sources.

The facility consists of a $1.65 billion five-year ABL revolver and an $850 million seven-year covenant-light term loan that has 101 soft call protection for one year, sources said.

Credit Suisse Securities (USA) LLC and Barclays Capital Inc. are the joint bookrunners on the term loan, and Wells Fargo Securities LLC, U.S. Bancorp Investments Inc., Barclays and Credit Suisse are the bookrunners on the ABL revolver.

Proceeds will be used to refinance existing debt.

SuperValu, an Eden Prairie, Minn.-based supermarket operator, first disclosed plans to bring a new deal to market in its earnings release on Thursday. The company said the refinancing is expected to close in August.

Patriot Coal expected soon

Patriot Coal's $802 million 450-day debtor-in-possession credit facility is targeted to launch with a bank meeting sometime next week, and the deal has received so much demand ahead of the launch that it is already oversubscribed, according to a market source.

The facility consists of a $125 million super-priority senior secured revolver, a $375 million super-priority senior secured term loan facility and a $302 million second-out roll-up of letters-of-credit loan.

Based on court documents, revolver pricing is expected at Libor plus 325 bps, and term loan and roll-up loan pricing is expected at Libor plus 800 bps, with all tranches having a 1.5% Libor floor.

And, while official talk is not out yet, unofficial guidance on the term loan has been circulating in the area of a mid-10% yield, the source said.

Patriot Coal lead banks

Citigroup Global Markets Inc., Barclays Capital Inc. and Bank of America Merrill Lynch are the joint lead arrangers on Patriot Coal's DIP.

Proceeds will be used to fund operations, working capital needs and general corporate purposes during the company's Chapter 11 reorganization.

The company has already received interim access to $677 million of the DIP.

Patriot Coal is a St. Louis-based miner, producer and seller of thermal coal primarily to electricity generators.

Pantry sets launch

Pantry joined next week's calendar, scheduling a bank meeting for Monday to launch a proposed $480 million senior secured credit facility (B1/BB) that consists of a $225 million revolver and a $255 million term loan B, according to a market source.

Wells Fargo Securities LLC and Bank of America Merrill Lynch are the lead banks on the deal.

Proceeds, along with $250 million of senior notes and available cash, will be used to repay about $598 million of outstanding term loans and senior subordinated notes.

Pantry is a Cary, N.C.-based operator of a chain of convenience stores.

Blue Buffalo readies deal

Blue Buffalo set a bank meeting for 10:30 a.m. ET on Monday to launch a new credit facility, according to a market source, who said that details on structure and use of proceeds are not yet available.

Citigroup Global Markets Inc. and Morgan Stanley Senior Funding Inc. are the lead banks on the deal.

Blue Buffalo is a Wilton, Conn.-based pet food company.

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