Iasis sets pricing; Ameritox circulates spread talk; LCDX index ends quarter-point higher

By Paul A. Harris

Portland, Ore., April 20 - Iasis Healthcare LLC came forward with pricing for its $1.235 billion credit facility on Wednesday, according to a market source.

The $935 million seven-year term loan (Ba3/B) its talked with a Libor plus 375 basis points to 400 bps spread with a 1.5% Libor floor at 99½ and with 101 soft call protection for one year.

Elsewhere, Ameritox Ltd. set spread talk of Libor plus 450 bps to 475 bps on its $425 million seven-year term loan B on Wednesday, a source said.

Amid quiet Wednesday trading, the LCDX 16 index ended the session a quarter of a point higher at 100 7/8 bid.

Secondary volumes were low due to holidays and school vacations, a bank loan trader remarked just ahead of the Wednesday close.

"New issues are going well," the trader added. "Yields are flexing tighter."

"There is a lot of cash to put to work, and the new issue calendar has been manageable," the source noted.

"It has not been as big as people thought it would be."

Evidence of strong demand

Recent deals are trading at healthy premiums to their respective issue prices, the trader pointed out.

The source spotted American Rock Salt's covenant-light term loan (B2/BB) with pricing of Libor plus 425 bps trading at par½ bid. The deal priced at 99½ on Tuesday.

The MoneyGram International Inc. $390 million 61/2-year Libor plus 325 bps term loan was at 100¾ bid.

The deal priced late last week at 991/2, the trader said.

Meanwhile, Triple Point Technology Inc.'s five-year term loan B was 99¾ bid on Wednesday, said the trader, noting that the loan priced at 99 on April 12 and bears interest at Libor plus 475 basis points.

The Sprouts Farmers Market $310 million Libor plus 450 bps term loan B was 98¾ bid. That deal from mid-March had priced at 98.

"We're seeing good evidence that there is still strong demand," said the trader, adding that investors are tending not to receive their full allocations.

Loans and high-yield bonds are set up pretty well, said the trader. "Economic growth is helping underlying valuations.

"TXU extended 80% of its debt. That alone cut the 2014 wall of maturities to $132 billion from $150 billion - $18 billion with one deal.

"Right now no one is talking about defaults," the source added.

Iasis details

Iasis' deal also includes a $300 million five-year Libor plus 350 bps revolver (Ba3/BB-), which is coming with a 150 bps upfront fee.

Merrill Lynch, Barclays Capital, Citigroup Global Markets, Goldman Sachs & Co. and J.P. Morgan Securities LLC are joint bookrunners.

GE Capital, SunTrust Robinson Humphrey and Wells Fargo Securities are the co-managers.

Proceeds will be used to refinance existing debt, to fund a $230 million dividend and to help fund the acquisition of St. Joseph Medical Center.

Ameritox term B

Ameritox's seven-year loan is expected to price at 99 and features a 1.25% Libor floor. It will come with a 101 soft call in year one.

Commitments are due by May 4.

The $450 million credit facility also features a $25 million five-year revolver.

J.P. Morgan Securities LLC is the lead bank on the deal.

Proceeds will be used to refinance existing debt and fund a dividend payment.

Asset Acceptance launches

Asset Acceptance Capital Corp. launched its $275 million credit facility on Wednesday.

The deal is comprised of a $175 million six-year term loan B, which comes with spread talk of Libor plus 400 to 425 bps and a 1.5% Libor floor along with an OID of 99, as well as a $100 million five-year revolver.

The term loan also features a 101 soft call in year one.

Commitments are due by May 4.

J.P. Morgan Securities LLC is the lead bank on the deal.

Proceeds will be used to refinance the company's existing credit facility that includes a $100 million revolver due June 5, 2012 and a term loan due June 5, 2013. As of Dec. 31, there was $133.4 million outstanding under the term loan.

Valitas to launch Tuesday

Valitas Health Services Inc. will launch its $360 million senior secured credit facility at a Tuesday bank meeting, according to a market source.

The deal, which is comprised of a $285 million six-year term loan and $75 million five-year revolver, is being led by Barclays Capital Inc. and Merrill Lynch.

Proceeds will be used to help fund the acquisition of America Service Group Inc. for $26 per share in cash, or about $250 million.

Other funds for the transaction will come from $100 million of mezzanine debt that has been committed by GSO Capital Partners LP.

Closing is expected in the second quarter, subject to the approval of America Service Group's stockholders and other customary conditions, including the satisfaction of governmental and regulatory approval requirements.

The combined company's annual revenues are expected to total $1.4 billion for 2011.

Mold-Masters flexes

Finally, the dealer flexed pricing on a secondary offering of the Mold-Masters Group term loan to 96 from 95 on Wednesday, according to an informed source.

The original Libor plus 350 basis points spread remains in place. There is no Libor floor.

Societe Generale is leading the transaction.

Recommitments were due by the end of the day on Wednesday. The deal was marketed via a lender call.

Just under $100 million of the loan is being offered, according to the source who added that although it is technically a secondary trade, it has been treated as a primary market deal and is oversubscribed.

The original loan was sized at about $214 million and was priced at 98.

Mold-Masters is an Ontario-based designer, manufacturer and supporter of hot runner products, including hot runner systems, temperature controllers, hot halves and gating technologies.

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