Gun Lake, Ocwen break; Cedar Fair changes expected; Kenan tweaks deal; Bryant OID emerges

By Sara Rosenberg

New York, July 14 - Gun Lake Tribe's revised term loan hit the secondary market on Wednesday, with levels seen above the debt's original issue discount price, and Ocwen Loan Servicing LLC's term loan freed up as well.

Meanwhile, over in the primary market, rumor is that on Thursday, Cedar Fair Entertainment Co. will be relaunching/revising its credit facility that has technically been sitting in market since late May.

Also, Kenan Advantage Group revised pricing on its term loans, Bryant & Stratton College came out with original issue discount talk on its credit facility, and Midcontinent Communications launched its new deal.

Furthermore, chatter is that Allscripts may be bringing its term loan B to market towards the end of this month, not too long after the syndication process on the pro rata debt wraps up.

Gun Lake starts trading

Gun Lake Tribe's $165 million first-lien term loan (B3/B) freed up for trading during the session, with levels quoted at 98 bid, 99 offered, according to a market source.

Pricing on the term loan is Libor plus 950 basis points with a 2.5% Libor floor, and it was sold at an original issue discount of 97. The loan is non-callable for three years, then at 105 in year four and 101 in year five.

During syndication, the term loan was upsized from $160 million, pricing was flexed higher from Libor plus 900 bps, the discount was increased from 98 and call protection was sweetened from non-callable for two years, then at 102 in year three and 101 in year four.

Goldman Sachs is the lead bank on the deal that allocated on Tuesday night but didn't break for trading until Wednesday.

Proceeds are being used to refinance some of a construction loan for the Gun Lake Casino in Michigan that was provided by Station Casinos Inc., which is the manager of the casino.

Ocwen frees up

Another deal to make its way into the secondary market on Wednesday was Ocwen Loan Servicing, with its $350 million senior secured term loan (B1/B/BB-) quoted at 98¼ bid, 99¼ offered, according to a market source.

Pricing on the term loan is Libor plus 700 bps with a 2% Libor floor, and it was sold at an original issue discount of 98. There is 101 soft call protection for one year.

During syndication, the discount firmed at the wide end of the initial 98 to 99 guidance.

Barclays and Deutsche Bank are the joint bookrunners on the deal, with Barclays the lead arranger.

Ocwen buying HomEq

Proceeds from Ocwen Loan Servicing's term loan will be used to help fund the purchase of Barclays Bank plc's HomEq Servicing, a U.S. mortgage servicing business, for $1.3 billion in cash.

As part of the purchase agreement, Barclays has agreed to provide Ocwen with seller financing in the form of a $140 million bridge loan, which is expected to be replaced by the term loan, and a $905 million servicer advance facility.

Closing on the acquisition is expected to take place in the third quarter, subject to customary conditions, including competition clearance.

Ocwen Loan Servicing is a subsidiary of Ocwen Financial Corp., a West Palm Beach, Fla.-based provider of residential and commercial loan servicing, special servicing and asset management services.

Cedar Fair readies revisions

Moving to the primary, market talk is that Cedar Fair will be relaunching/revising its credit facility that was initially presented to lenders on May 21, but has been somewhat stagnant since the company's proposed bond offering never ended up pricing, according to a market source.

The chatter is that the term loan tranche will be increased by $200 million to $300 million, while the bond offering will be decreased by the same amount, the source said.

When first launched, the senior secured credit facility (Ba2/BB-) was sized at $1.35 billion, comprised of a $1.05 billion term loan talked at Libor plus 375 bps with a 1.5% Libor floor and an original issue discount of 99 to 991/2, and a $300 million five-year revolver talked at Libor plus 350 bps with no Libor floor.

And, the company's original senior unsecured bond offering, which launched with a roadshow on May 20 and was expected to price on May 27, was sized at $500 million.

Cedar Fair refinancing debt

Proceeds from Cedar Fair's credit facility and notes will be used to refinance an existing credit facility.

As of March 28, the company had $1.5 billion of term loan debt with a final maturity in 2012 and $216 million in borrowings under its revolving credit facility that matures in 2011.

JPMorgan and UBS are the lead banks on the new credit facility, with JPMorgan the left lead.

Cedar Fair is a Sandusky, Ohio-based regional amusement-resort operator.

Kenan revises pricing

Kenan Advantage Group raised pricing on its $250 million term loan B and $125 million delayed-draw term loan to Libor plus 450 bps from Libor plus 400 bps, but left pricing on its $75 million revolver at Libor plus 400 bps, according to a market source.

Also, the original issue discount on the term loan B was increased to 98 from 99, but the discount on the delayed-draw loan was left unchanged at 98 and the discount on the revolver was left at 983/4, the source said.

All tranches under the $450 million credit facility (Ba3/BB-) continue to include a 1.75% Libor floor.

With the changes, a healthy book has been building for the term loans, the source remarked.

Kenan being acquired

Proceeds from Kenan Advantage's credit facility will be used to help fund the buyout of the company by Goldman Sachs from Littlejohn & Co.

Additionally, proceeds from the facility will be used to refinance existing debt.

KeyBanc Capital Markets is the lead arranger, bookrunner and administrative agent on the deal.

Kenan Advantage is a North Canton, Ohio-based logistics and liquid bulk transportation services provider to the fuels, chemical and food end-markets.

Bryant & Stratton sets OID talk

Bryant & Stratton College held a bank meeting at 10 a.m. ET on Wednesday to kick off syndication on its proposed $220 million five-year senior secured credit facility, and in connection with the launch, original issue discount talk was announced, according to a market source.

Both the $40 million revolver and the $180 million term loan B are being offered to investors at a discount of 98, the source said.

As was previously reported, the two tranches are being talked at Libor plus 500 bps to 525 bps with a 1.5% Libor floor.

GE Capital and Bank of America are the lead banks on the deal.

Bryant & Stratton refinancing debt

Proceeds from Bryant & Stratton College's credit facility will be used to refinance existing senior and mezzanine debt associated with the company's buyout in February 2008 by Parthenon Capital Partners.

In addition, proceeds will go towards the payment of a dividend payment to the sponsor/co-investors.

Pro-forma leverage for the transaction is 2.92 times senior and total.

Earlier this month, the company secured corporate ratings of B1/B+ with a stable outlook.

Bryant & Stratton College is a for-profit provider of post-secondary education with a network of 16 campuses in New York, Ohio, Virginia and Wisconsin, as well as online.

Midcontinent launches

Also launching with a bank meeting on Wednesday was Midcontinent Communications' proposed $350 million 61/2-year term loan B, which, as was previously disclosed, is being talked at Libor plus 450 bps to 475 bps with a 1.75% Libor floor and an original issue discount of 981/2, according to a market source.

The term loan B carries 101 soft call protection for one year.

The company's $675 million senior secured credit facility (B1/B+) also includes a $125 million 51/2-year revolver and a $200 million 51/2-year term loan A, with both of these tranches already fully subscribed.

Price talk on the revolver and the term loan A is Libor plus 400 bps, but there is MFN language, such that the spread on these tranches has to be within 50 bps of the term loan B.

The revolver has a 50 bps unused fee.

Midcontinent lead banks

SunTrust, Wells Fargo, US Bank and RBC are the joint bookrunners on Midcontinent Communications' credit facility, with SunTrust the left lead. CoBank and Bank of America have signed on as agents.

Proceeds will be used to fund a $320 million distribution to the partnership, refinance about $230 million of debt and for general corporate purposes.

Midcontinent Communications is a partnership that was formed in April 2000 as joint venture between Midcontinent Media Inc. and Comcast Corp.

The company's founder, Larry Bentson, passed away in 2009 and left the business to its three top officers. As part of the estate settlement, the company has to pay $160 million to the estate and $160 million to Comcast - the $320 million distribution that the credit facility will finance.

Midcontinent Communications is a Minneapolis-based provider of cable television, local and long-distance digital telephone service and high-speed internet access.

Allscripts B loan may hit soon

Allscripts' proposed $250 million term loan B is expected to launch sometime around July 29, according to a market source, which is about a week after the books close on the company's pro rata bank debt.

The company's $150 million five-year revolver and $320 million term loan A were already launched to banks on July 8 with price talk of Libor plus 325 bps. Pricing on the tranches can range from Libor plus 250 bps to 350 bps based on leverage, with the lowest point on the grid being 0.5 times leverage and the highest point being 2.5 times.

The revolver has a 50 bps unused fee.

Price talk on the term loan B is not yet available.

Initially, the deal was outlined as containing one term loan sized at $570 million, but the loan was later divided into an A and a B tranche. Sizes can still be moved around based on demand.

Allscripts purchasing shares

Proceeds from Allscripts' credit facility will be used to fund the buyback of 24.4 million of shares from Misys plc for an aggregate consideration of $577 million.

Allscripts will then merge with Eclipsys, an Atlanta-based provider of health care IT services, and following this merger, Misys will have an option to sell to Allscripts an additional 5.3 million of shares for $102 million.

JPMorgan, Barclays Capital and UBS are the lead banks on the $720 million credit facility (Ba2/BBB-) that will be used to fund the initial buyback of shares, while any additional buyback will be funded with cash on hand.

Subject to certain conditions being met, the buyback of shares and the merger with Eclipsys are expected to be completed in September or October.

Allscripts, a Chicago-based provider of software, services, information and connectivity services to physicians and other health care providers, will have pro forma leverage of 2.1 times.

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