Westmoreland Coal breaks; Presidio, Stonewall Gas surface with investor-friendly changes

By Sara Rosenberg

New York, Jan. 21 – Westmoreland Coal Co.’s add-on term loan freed up for trading during Wednesday’s market hours with levels quoted above its original issue discount.

Moving to the primary, Presidio Inc. adjusted the spread, offer price and call protection on its term loan, and Stonewall Gas Gathering LLC lifted price talk on its term loan B, widened the original issue discount and sweetened the call protection.

Also, Digital River Inc. and US Farathane Corp. disclosed talk with launch, New Media Investment Group Inc. came to market with a term loan that would combine all of its existing term loans into one tranche, and Heartland Dental Care LLC surfaced with new deal plans.

Westmoreland hits secondary

Westmoreland Coal’s fungible $75 million add-on senior secured term loan broke for trading on Wednesday with levels seen at 97¾ bid, 98¾ offered, according to a trader.

Pricing on the add-on loan is Libor plus 650 basis points with a 1% Libor floor, in line with the existing term loan, and it was sold at an original issue discount of 97½.

During syndication, the add-on loan was upsized from $50 million.

BMO Capital Markets Corp. is the lead on the deal that is being used to back the recently completed $34 million acquisition of Buckingham Coal Co. LLC, a conductor of underground room and pillar mining operations in Ohio.

Westmoreland is an Englewood, Colo.-based coal company.

Presidio reworks deal

Switching to the primary, Presidio lifted pricing on its $600 million seven-year first-lien covenant-light term loan to Libor plus 525 bps from Libor plus 475 bps, changed the original issue discount to 97 from 99 and extended the 101 soft call protection to one year from six months, according to a market source.

Also, the incremental allowance was cut to $125 million from $175 million, the 12-month sunset provision was eliminated, the general restricted payments basket was lowered to $50 million from $75 million, and the excess cash flow sweep was increased to 75% with step-downs from 50% with step-downs, the source said.

The term loan still has a 1% Libor floor.

The company’s $650 million credit facility (B1/B) also includes a $50 million revolver.

Recommitments are due at 5 p.m. ET on Thursday, the source added.

Credit Suisse Securities (USA) LLC, Barclays, Citigroup Global Markets Inc., RBC Capital Markets LLC and Goldman Sachs Bank USA are leading the deal that will be used to help fund the buyout of the New York-based IT infrastructure services provider by Apollo Global Management LLC from American Securities LLC.

Stonewall revises loan

Another deal to undergo changes was Stonewall Gas, with talk on its $350 million seven-year senior secured term loan B (B) increased to Libor plus 775 bps to 800 bps from Libor plus 650 bps, the original issue discount moved to 95 from 98, and the call protection changed to non-callable for one year, then hard call protection of 102 in year two and 101 in year three, from non-callable for one year, then 101 soft call protection in year two, a market source remarked.

Furthermore, it was revealed that the incremental facility can only be used for expansionary capital expenditures and is subject to 50 bps MFN with no sunset provision, the source said.

The term loan still has a 1% Libor floor.

Recommitments were due at noon ET on Wednesday, the source added.

Stonewall lead banks

Citigroup Global Markets Inc., BMO Capital Markets and Bank of America Merrill Lynch are leading Stonewall Gas’ term loan B.

Proceeds will be used to fund the construction costs and construction period debt service associated with the development of the Stonewall Gas system and to pay related fees and expenses.

As originally outlined, a segregated construction account will be established at closing into which all the proceeds of the term loan will be deposited to fund scheduled principal and interest through first quarter 2017 and the Stonewall construction costs.

Stonewall Gas is a critical gas gathering pipeline system in the Southwest Marcellus shale that is being developed by M3 Midstream LLC.

Digital River reveals talk

In more primary happenings, Digital River held its bank meeting on Wednesday, launching its $255 million six-year first-lien term loan (B1/B) with talk of Libor plus 575 bps with a 1% Libor floor, an original issue discount of 98 and 101 soft call protection for six months, according to a market source.

Commitments are due on Feb. 5, the source said.

The company’s $345 million senior secured credit facility also includes a $10 million revolver (B1/B), and an $80 million second-lien term loan (Caa1/CCC) that was privately placed.

Macquarie Capital (USA) Inc. is leading the deal that will be used with up to $328.9 million of equity to fund the buyout of the company by Siris Capital Group LLC for $26.00 per share in cash, or about $840 million.

Closing is expected this quarter, subject to customary conditions, including the receipt of shareholder approval and the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act.

Digital River is a Minneapolis-based provider of commerce as a service.

US Farathane sets guidance

US Farathane released talk of Libor plus 550 bps to 575 bps with a 1% Libor floor, an original issue discount of 98½ and 101 soft call protection for six months on its $390 million seven-year term loan B that launched with a bank meeting, a source remarked.

Commitments are due on Feb. 4, the source added.

Bank of America Merrill Lynch, Barclays, Morgan Stanley Senior Funding Inc. and MCS Capital are leading the deal that will be used to help fund the buyout of the company by the Gores Group and several members of US Farathane’s management, including its chief executive officer, Andy Greenlee.

US Farathane is an Auburn Hills, Mich.-based provider of highly engineered plastic injection-molded components.

New Media launches

New Media Investment Group launched during the session without a formal call or meeting a $327 million term loan due June 2020 talked at Libor plus 625 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, a market source said.

Commitments for the new term loan are due on Feb. 4, the source added.

Citizens Financial Group is leading the deal that will be used to refinance the company’s existing three term loans due June 2020 priced at Libor plus 625 bps with a 1% Libor floor.

The existing loans are split between a $102 million term loan that funded recently, a $25 million add-on term loan completed in September 2014 and a $200 million term loan completed around the summer of 2014.

As previously reported, the existing $102 million term loan had been launched into syndication in early December with a size of $170 million and talk of Libor plus 550 bps to 575 bps with a 1% Libor floor and an original issue discount of 99, but, in order for the deal to close, it ended up being downsized and funded by the lead.

New Media is a New York-based publisher of locally based print and online media.

Heartland readies add-on

Heartland Dental Care set a call for 4 p.m. ET on Thursday to launch a fungible $75 million add-on term loan (B) that is talked at Libor plus 450 bps with a 1% Libor floor and an original issue discount that is still to be determined, according to a market source.

The spread and floor on the add-on loan matches the existing term loan.

Commitments are due on Jan. 29, the source said.

RBC Capital Markets is leading the deal that will be used to repay all of the company’s outstanding revolver borrowings.

Heartland Dental is an Effingham, Ill.-based provider of office support services to dental offices.

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