Primary sees over 10 deals emerge with launch plans; Dixie reveals structure; BWIC surfaces

By Sara Rosenberg

New York, Jan. 6 - The primary market was abuzz on Monday as a slew of deals jumped onto this week's calendar, including Applied Systems Inc., Community Health Systems Inc., National Mentor Holdings Inc., NEP/NCP Holdco Inc., PharMEDium Healthcare Corp., Sophos Ltd. (Shield Finance Co. S.a.r.l.), Endeavour International Holding, Emerald Expositions Holding Inc., Epicor Software Corp., Surgery Center Holdings Inc. and Houghton Mifflin Harcourt Publishers Inc. (HMH Holdings Inc.).

Also, NewPage Holdings Inc. came out with expected timing on its new loan, Phillips Pet Food & Supplies joined next week's calendar and Dixie Electric LLC (FR Dixie Acquisition Corp.) released further details on its proposed credit facility.

Meanwhile, over in the secondary market, a new Bid-Wanted-In-Competition was announced.

Applied Systems readies deal

Applied Systems set a bank meeting for 2 p.m. ET in New York on Tuesday to launch a $1.1 billion credit facility and released price talk on the term loan portion of the transaction, according to a market source.

The facility consists of a $50 million revolver, a $675 million seven-year first-lien covenant light term loan talked at Libor plus 350 bps to 375 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, and a $375 million eight-year second-lien covenant-light term loan talked at Libor plus 725 bps to 750 bps with a 1% Libor floor, a discount of 99 and call protection of 102 in year one and 101 in year two, the source said.

Commitments are due on Jan. 17.

Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. Jefferies Finance LLC and UBS Securities LLC are leading the deal that will be used to help fund the roughly $1.8 billion buyout of the company by Hellman & Friedman LLC from Bain Capital.

Applied Systems is a University Park, Ill.-based provider of software for the insurance industry.

Community Health timing

Community Health disclosed that it will hold a bank meeting at 11 a.m. ET in New York on Wednesday to launch a new $2.26 billion seven-year term loan D and an extension of up to 50% of its term loan C (around $1.7 billion), according to a market source.

The extended term loan C will be fungible with the term loan D, the source said.

Credit Suisse Securities (USA) LLC and Bank of America Merrill Lynch are the joint physical bookrunners on the deal, and Citigroup Global Markets Inc., Goldman Sachs Bank USA, J.P. Morgan Securities LLC, RBC Capital Markets, SunTrust Robinson Humphrey Inc., UBS Securities LLC and Wells Fargo Securities LLC are bookrunners too.

Commitments are due on Jan. 17, the source added.

Community buying HMA

Proceeds from Community Health's new term loan D will be used to help fund the acquisition of Health Management Associates Inc. for $13.78 per share, consisting of $10.50 per share in cash plus 0.06942 of a share of Community Health common stock for each Health Management share. The transaction is valued at about $7.6 billion, including the assumption of around $3.7 billion of debt.

Closing is anticipated by the end of this quarter, subject to approval by a 70% vote of Health Management's stockholders, antitrust clearance, receipt of other regulatory approvals, the absence of certain adverse developments, and customary conditions. The transaction is not subject to financing.

Community Health is a Nashville, Tenn.-based hospital company. Health Management is a Naples, Fla.-based owner and manager of hospitals and ambulatory surgery centers.

National Mentor on deck

National Mentor scheduled a bank meeting for 1 p.m. ET on Wednesday to launch a $660 million senior secured credit facility, according to a market source.

The facility consists of a $100 million revolver and a $560 million term loan B, the source remarked.

Barclays, Goldman Sachs Bank USA, Jefferies Finance LLC and UBS Securities LLC are leading the deal that will be used to refinance the company's existing senior secured credit facility.

National Mentor is a Boston-based provider of home and community-based health and human services.

NEP launch announced

NEP will hold a call at 2 p.m. ET on Tuesday to launch a $155 million incremental senior secured first-lien term loan (B2/B), according to a market source.

The company currently has a $525 million first-lien term loan due Jan. 22, 2020 priced at Libor plus 350 bps with a 1.25% Libor floor.

Barclays and Morgan Stanley Senior Funding Inc. are leading the deal that will be used to help fund the acquisition of GTV Holdings Pty Ltd (Global Television) from Catalyst Investment Managers.

Closing is expected early this year.

NEP is a Pittsburgh-based provider of outsourced teleproduction services critical to the delivery of live sports and entertainment events. Global Television is an Australia-based television technical services company.

PharMEDium details

PharMEDium surfaced with plans to hold a bank meeting at 10 a.m. ET in New York on Wednesday to launch the financing for its buyout by Clayton, Dubilier & Rice, which is now known to include a $595 million credit facility, a market source remarked.

The facility consists of a $75 million revolver, a $320 million seven-year first-lien covenant-light term loan that has 101 soft call protection for six months and a $200 million eight-year second-lien covenant-light term loan that has call protection of 102 in year one and 101 in year two, the source said.

Commitments are due on Jan. 22.

Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and Morgan Stanley Senior Funding Inc. are leading the deal, with Credit Suisse left lead on the second-lien and JPMorgan left lead on the first-lien.

As part of the buyout, Oak Investment Partners and Baird Capital will exit their stake in the company, while JVC Management will retain a stake.

PharMEDium is a Lake Forest, Ill.-based provider of hospital pharmacy-outsourced sterile compounding services.

Sophos sets meeting

Sophos intends to host a bank meeting at 9:30 a.m. ET in New York on Thursday to launch a $400 million seven-year covenant-light term loan that has 101 soft call protection for six months, according to a market source.

Deutsche Bank Securities Inc. is leading the deal.

Proceeds will be used to refinance an existing term loan.

Sophos is an IT security and data protection firm that has headquarters in Burlington, Mass., and Oxford, England.

Endeavour plans loans

Endeavour set a conference call for 11 a.m. ET on Tuesday to launch $255 million in senior secured term loans due Nov. 30, 2017, split between a $125 million tranche that is collateral for letters-of-credit and a $130 million tranche that is a procurement facility, according to a market source.

The loans will be sold as a strip and are non-callable for one year, then at par, except for $98 million of the procurement facility, which can be called at par for six months.

Commitments are due on Jan. 21, the source said.

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

Endeavour International is a Houston-based oil and gas exploration and production company.

Emerald joins calendar

Emerald Expositions will hold a call on Tuesday to launch a fungible $200 million covenant-light incremental term loan B due June 2020 priced at Libor plus 425 bps with a 1.25% Libor floor, in line with the existing term loan B, according to sources. The original issue discount on the new debt is still to be determined.

Like the existing loan, the incremental has 101 soft call protection until June 16, 2014.

Bank of America Merrill Lynch and Morgan Stanley Senior Funding Inc. are leading the deal that will be used with a $140 million equity investment from Onex Partners III to fund the $335 million acquisition of George Little Management LLC (GLM).

Closing is expected this month, subject to customary regulatory approvals

Emerald is a San Juan Capistrano, Calif.-based operator of large business-to-business tradeshows. GLM is a White plains. N.Y.-based operator of tradeshows, consumer events and digital platforms.

Epicor repricing

Epicor Software scheduled a call for Tuesday to launch a roughly $840 million term loan due May 16, 2018 that will reprice its existing term loan from Libor plus 325 bps with a 1.25% Libor floor, according to a market source.

Bank of America Merrill Lynch is leading the deal.

Epicor is a Dublin, Calif.-based provider of enterprise business software services.

Surgery Center plans add-on

Surgery Center set a call for Tuesday to launch a $70 million add-on second-lien term loan (Caa2) that is talked at Libor plus 850 bps with a 1.25% Libor floor and an original issue discount of 98½ to 99, according to a market source.

The spread and floor on the incremental match the existing second-lien term loan.

J.P. Morgan Securities LLC and Morgan Stanley Senior Funding Inc. are leading the deal that will be used to fund a dividend.

Surgery Center is a Chicago-based operator of ambulatory surgery centers.

Houghton to hold call

Houghton Mifflin scheduled a conference call for 1:30 p.m. ET on Tuesday for all credit facility lenders, according to a market source.

Citigroup Global Markets Inc. is leading the transaction.

No further details are available as of yet, the source added.

Houghton Mifflin is a Boston-based publishing company.

NewPage readies loan

NewPage intends to hold a bank meeting next week to launch a proposed $750 million term loan that is being led by Credit Suisse Securities (USA) LLC, Barclays, UBS Securities LLC and BMO Capital Markets, a market source said.

The loan is being done in connection with the acquisition of the company by Verso Paper Corp., and will be used to refinance NewPage's existing $500 million term loan and fund a dividend.

In addition to the term loan, NewPage's senior secured credit facility will include an ABL facility that will replace an existing $350 million ABL facility.

Under the agreement, NewPage's equity holders will receive $900 million, consisting of the special $250 million dividend payment, and $650 million of new Verso first-lien notes to be issued at closing, plus shares of Verso common stock representing 20% of the outstanding shares as of immediately prior to closing.

Closing is expected in the second half of the year, subject to regulatory approvals.

NewPage is a Miamisburg, Ohio-based producer of printing and specialty papers. Verso is a Memphis, Tenn.-based producer of coated papers.

Phillips Pet coming soon

Phillips Pet Food & Supplies set a bank meeting for Jan. 14 to launch a $450 million credit facility, according to a market source.

The facility includes $60 million ABL revolver, a $260 million first-lien term loan and a $130 million second-lien term loan, the source said.

Jefferies Finance LLC, Goldman Sachs Bank USA and BMO Capital Markets are leading the deal that will be used to help fund the buyout of the company by Thomas H. Lee Partners from AEA Investors.

Phillips Pet is an Easton, Pa.-based distributor of pet food and supplies.

Dixie details surface

Dixie Electric revealed that its proposed seven-year term loan B will come to market with a size of $280 million, according to a source.

The B loan is talked with a 1% Libor floor, 101 soft call protection and amortization of 1% per annum.

Also included in the company's $320 million credit facility is a $40 million five-year revolver.

A bank meeting for the deal will take place at 2:30 p.m. ET on Wednesday, with commitments set to be due on Jan. 21, the source continued.

UBS Securities LLC, Credit Suisse Securities (USA) LLC, Macquarie Capital and Societe Generale are leading the deal that will be used to help fund the buyout of the company by First Reserve from One Rock Capital Partners LLC.

Dixie is an Odessa, Texas-based provider of electrical infrastructure materials and services to the upstream oil and gas sector.

BWIC emerges

Moving to the secondary, an $84.5 million BWIC was announced during the session, with market players having until 11 a.m. ET on Tuesday to place their bids, according to a trader.

Some of the larger pieces of debt offered in the portfolio are Bass Pro Group LLC's new term loan, Cequel Communications LLC's term loan, Crown Castle Operating Co.'s new term loan B, Digitalglobe Inc.'s term loan, Dunkin' Brands Inc.'s term loan B-3, Emdeon Inc.'s term loan B-2, Interactive Data Corp.'s term loan B and Virgin Media Investment Holdings Ltd.'s B facility.

There are about 38 issuers in the BWIC, the trader added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.