Serta upsizes, slashes spread talk; Alkermes prices atop tightened talk; Truven brings repricing

By Paul A. Harris

Portland, Ore., Sept. 18 - Serta/Simmons (AOT Bedding Super Holdings LLC) upsized its seven-year senior secured term loan to $1.31 billion from $1.233 billion, and the Libor spread talk was slashed to 375 basis points from previous talk of 425 to 450 bps.

Alkermes Inc. priced $375 million of term loans on top of tightened spread talk.

And the building forward calendar saw Truven Health Analytics set the launch of $578 million of credit facilities (current ratings Ba3/B+) for Wednesday.

The LCDX 18 bank loan index ended the day 1/8 of a point lower at 101 3/8 bid, 101 7/8 offered, according to a market source.

The Serta/Simmons deal comes with a 1.25% Libor floor and an original issue discount of 99.

Pricing is expected on Wednesday.

The facility also includes a $225 million ABL revolver.

Morgan Stanley Senior Funding Inc., Goldman Sachs & Co., UBS Securities LLC, Deutsche Bank Securities Inc. and Barclays are the bookrunners on the deal and joint lead arrangers with Jefferies & Co. and RBC Capital Markets LLC.

Proceeds will be used to help fund the acquisition of the company by Advent International and to refinance existing debt.

Other funds for the transaction will come from $725 million of high-yield bonds, for which Goldman Sachs is the left lead.

Under the agreement, mattress manufacturer AOT, the parent company of Hoffman Estates, Ill.-based National Bedding Co. and Atlanta-based Simmons Bedding Co., is being purchased from Ares Management LLC and the Ontario Teachers' Pension Plan.

However, Ares and Ontario Teachers' will retain a significant equity stake in the company.

Closing is expected in the fourth quarter, subject to conditions.

Alkermes prices $375 million

The Alkermes deal included a $300 million seven-year senior secured term loan B, which priced at 99 with a Libor plus 350 basis points spread.

The deal came on top of spread talk, which had tightened from 375 bps. Earlier guidance was 375 to 400 bps. The term B features a 1% Libor floor.

Alkermes also priced a $75 million four-year term loan B at 99.50, with a Libor plus 300 bps spread, atop talk that had tightened earlier in the day from 325 bps.

The four-year loan also has a 1% Libor floor.

Both loans have 101 soft call protection for one year.

Amortization is 1% per annum on the seven-year loan and 5% for the first three years on the four-year loan.

Morgan Stanley Senior Funding Inc, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC are the lead banks on the deal.

Proceeds will be used to refinance existing credit facility debt.

Alkermes is a Dublin-based biopharmaceutical company.

SkillSoft sets talk

SSI Investments II Ltd., the corporate parent of business training software provider SkillSoft Ltd., set talk for $458 million credit facilities on Tuesday, according to an informed source.

The deal, which involves a $50 million incremental term loan and a repricing of $407.825 million of existing facilities, is talked with a Libor spread of 375 to 400 basis points with a 1.25% Libor floor.

Discount talk is 99 to 99.5.

There will be a 101 soft call in year one.

Commitments are due on Sept. 25.

Morgan Stanley & Co., Barclays and Deutsche Bank Securities Inc. are the joint lead arrangers.

Proceeds will be used to fund the acquisition of ThirdForce Group plc.

SkillSoft is a Nashua, N.H.-based provider of on-demand e-learning and performance support services for global enterprises, government, education and small- to medium-sized businesses.

Payless upsizes

Payless ShoeSource/Collective Licensing International upsized its $275 million term loan (B1/B) to $305 million from $275 million on Tuesday.

Spread talk tightened to Libor plus 600 basis points with a 1.25% Libor floor. Earlier talk was 600 to 625 bps.

Discount talk tightened to 98.50 from 98 to 99.

The loan has 101 soft call protection for one year, the source said.

The loan is expected to price and allocate on Wednesday.

Morgan Stanley Senior Funding Inc., Jefferies & Co. and KKR Capital Markets are leading the deal.

In addition, the company is getting a $250 million senior secured asset-based revolving credit facility from Wells Fargo Capital Finance.

Proceeds will be used to help fund the buyout of the company by Blum Capital Partners and Golden Gate Capital from Collective Brands Inc.

Closing is expected late in the third quarter or early in the fourth quarter. The deal is subject to customary conditions, including Collective Brands' shareholder approval and regulatory approval, which have both been received.

Payless, a specialty family footwear retailer, will continue to have headquarters in Topeka, Kan., and Collective Licensing, a development and licensing company, will remain based in Englewood, Colo.

Truven sets lender call

Truven set a lender call at 11 a.m. ET on Wednesday to discuss $578 million of credit facilities (current ratings Ba3/B+).

Under discussion will be a $50 million revolver and the repricing of a $527.6 million seven-year term loan B.

The price talk is Libor plus 450 bps with a 1.25% Libor floor at par, with a 101 soft call.

J.P. Morgan Securities LLC has the books.

Proceeds will be used to refinance the existing term loan B.

Truven is a provider of healthcare data and data analytics.

Harvard Drug for Thursday

Harvard Drug Group, LLC set a lender meeting in New York on Thursday for its $345 million senior secured term loan B, according to an informed source.

Morgan Stanley & Co. and Deutsche Bank Securities Inc. are the joint lead arrangers and bookrunners.

The Livonia, Mich.-based independent pharmaceutical distributor plans to use the proceeds to refinance debt and finance the acquisition of The Rugby Group, Inc., and another company.

PTC Alliance bank meeting

Bookrunner Credit Suisse Securities (USA) LLC will host a 1:30 p.m. ET Wednesday bank meeting for the PTC Alliance Holdings Corp. $225 million six-year covenant-lite term loan, according to a informed source.

Pricing and credit ratings remain to be determined.

The loan comes with 102 call protection.

The Wexford, Pa., manufacturer and marketer of welded and cold drawn mechanical steel products plans to use the proceeds to fund a dividend and for general corporate purposes.

TriZetto second-lien deal

TriZetto Group Inc. set an investor call for 1 p.m. ET on Thursday to launch its $150 million seven-year second-lien term loan, according to an informed source.

RBC Capital Markets is the sole lead arranger.

Proceeds will be used to refinance the company's revolver and put additional cash on its balance sheet.

TriZetto is a Greenwood Village, Colo.-based health care information technology company to the health care payer industry.

Rocket Software tack-on

Rocket Software, Inc. will hold a Wednesday investor conference call for a $59 million tack-on to its first lien term loan due Feb. 8, 2018.

The deal, which is being led by Credit Suisse Securities (USA) LLC, is talked Libor plus 550 basis points with a 1.5% Libor floor, discounted to 99.5.

The deal features a 101 soft call through February 2013.

The Newton, Mass.-based software development firm plans to use the proceeds to fund acquisitions.

Rocket Software priced a $300 million Libor plus 550 bps first lien term loan at 98 on Feb. 3, 2012.

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