Amneal extended loan bid below OID; Veritiv, Buckeye Partners pricing guidance surfaces

By Sara Rosenberg

New York, Nov. 6 – Amneal Pharmaceuticals’ amended and extended term loan B was seen quoted in the secondary market on Monday below its original issue discount following allocations going out late Friday.

Meanwhile, in the primary market, Veritiv Corp. and Buckeye Partners LP released price talk on their term loans in connection with their lender calls.

Also, Everise (BCP V Everise Acquisition LLC), Hertz Corp. and Smyrna Ready Mix Concrete LLC joined this week’s new issue calendar.

Amneal levels emerge

Amneal Pharmaceuticals’ roughly $2.35 billion amended and extended term loan B (B2/B) due 2028 was quoted at 93 bid, 94 offered on Monday after allocating on Friday, a market source said.

Pricing on the extended loan is SOFR plus 550 basis points with a 0.5% floor and it was sold at an original issue discount of 95. The debt has hard call protection of 103 in year one, 102 in year two and 101 in year three.

“I hear that it’s loosely quoted and there’s almost no volume trading,” the source remarked. “We saw no markets on Friday.”

“Sometimes you get troublemakers who were not on the deal trying to create an impression and shake out weak hands. A competing dealer who saw the OID widen out might be real on the left side and not have a real seller below the OID. So, while it’s not a sign of market comfort that the quote is below the OID, I think the widening alone would have told the market that. If you hear of real sellers below the OID, the story is a little more interesting,” the source added.

Amneal lead bank

JPMorgan Chase Bank is leading Amneal’s term loan that will be used to amend and extend a portion of the company’s existing $2.544 billion term loan due May 2025, leaving a roughly $194 million stub non-extended term loan tranche in place.

During syndication, the size of the extended term loan finalized from revised talk of minimum $2.25 billion and initial talk of $2.544 billion, the spread widened from SOFR plus 525 bps, the discount was changed from 96, the call protection was revised from a 102 hard call in year one and a 101 soft call in year two, and modifications were made to documentation.

The non-extended term loan is priced at SOFR+CSA plus 350 bps. CSA is ARRC standard of 11.448 bps one-month rate, 26.161 bps three-month rate and 42.826 bps six-month rate.

Amneal is a Bridgewater, N.J.-based generic pharmaceutical manufacturer.

Veritiv talk

Moving to the primary market, Veritiv held its lender call on Monday afternoon and announced talk on its $700 million seven-year term loan B (B2/B+) at SOFR plus 450 bps with a 0% floor and an original issue discount of 98, according to a market source.

Commitments for the term loan are due at noon ET on Nov. 16, the source added.

The company’s $1.525 billion of credit facilities also include an $825 million five-year ABL revolver.

RBC Capital Markets, Goldman Sachs Bank USA, Wells Fargo Securities LLC, BMO Capital Markets, UBS Investment Bank, BNP Paribas Securities Corp., Mizuho Bank, TD Securities (USA) LLC, Natixis, Rabobank, Regions Capital Markets, Citizens Bank, ING Capital LLC, Stifel and the Bank of Nova Scotia are leading the deal that will be used with $600 million of other seven-year senior secured debt and $1.12 billion of equity to fund the buyout of the company by Clayton, Dubilier & Rice LLC for $170 per share in a transaction with an enterprise value of $2.6 billion.

Closing is expected in the fourth quarter, subject to shareholder approval and other customary conditions, including the receipt of required regulatory approvals.

Veritiv is an Atlanta-based distributor of packaging, facility solutions and print products.

Buckeye guidance

Buckeye Partners came out with talk of SOFR plus 250 bps to 275 bps with no floor and an original issue discount of 99.5 on its $1 billion term loan B that launched with a call in the afternoon, a market source said.

The term loan has 101 soft call protection for six months.

Commitments are due at 5 p.m. ET on Nov. 16.

MUFG is the left lead on the deal, which will be used to fund a partial refinancing of the company’s term loan B due 2026 priced at SOFR plus 225 bps with a 0% floor and revolving credit facility.

Buckeye is a Houston-based owner and operator of integrated midstream assets.

Everise on deck

Everise set a lender call for 11 a.m. ET on Tuesday to launch a $425 million seven-year covenant-lite term loan B, according to a market source.

BMO Capital Markets, Standard Chartered, ING, Bank of Nova Scotia and Societe Generale are leading the deal that will be used for the acquisition of a roughly 47% equity stake in the company by Warburg Pincus from Brookfield Asset Management and other shareholders at a total enterprise value of about $1.03 billion. As part of the transaction, Everstone Group will exit its investment in the company.

Closing is expected by the end of the year.

Everise is a Plantation, Fla.-based health care services outsourcing company.

Hertz readies deal

Hertz scheduled a lender call for 11:30 a.m. ET on Tuesday to launch a non-fungible $400 million incremental senior secured term loan B due June 30, 2028, a market source remarked.

The incremental term loan has 101 soft call protection for six months, the source added.

Barclays, Goldman Sachs Bank USA and others to be announced are leading the deal that will be used to repay outstanding borrowings under the company’s existing senior secured revolver due 2026, to pay transaction related fees and expenses, and for general corporate purposes.

Hertz is an Estero, Fla.-based car rental company.

Smyrna joins calendar

Smyrna Ready Mix Concrete will hold a lender call at 11 a.m. ET on Tuesday to launch a $538 million term loan B (Ba3) due 2029, according to a market source.

Commitments are due at 5 p.m. ET on Nov. 13, the source added.

JPMorgan Chase Bank is leading the deal that will be used with $1.1 billion of senior secured notes to fund acquisitions and to pay down term loan and asset-based lending borrowings.

Smyrna Ready Mix is a Murfreesboro, Tenn.-based manufacturer and retailer of ready-mixed concrete.

Loan indices rise

In other news, S&P Global’s iBoxx loan indices were stronger on Friday, with the Leveraged Loan index (MiLLi) closing up 0.17% and the Liquid Leveraged Loan index (LLLi) closing up 0.24%.

Month to date, the MiLLi is up 0.26% and year to date it is up 10.07%, and the LLLi is up 0.33% month to date and up 9.19% year to date.

Average secondary market bids in the United States on Friday were 92.99, up 0.06% from the previous day and up 1.22% year to date.

According to the S&P Global data, some of the top advancers on Friday were Team Health’s January 2017 covenant-lite term loan at par, up from 97.33, Valeant’s May 2022 term loan at 77.83, up from 75.92, and Varsity Brands’ November 2017 covenant-lite term loan B at par, up from 98.25.

Some top decliners on Friday were CenturyLink/Lumen’s January 2020 non-TSA covenant-lite term loan B at 66.44, down from 68.34, McAfee/Magenta’s May 2021 second-lien covenant-lite term loan at 39.6, down from 40.6, and Gabriel Brothers/Gabe’s October 2021 term loan at 73, down from 74.5.

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