Berry Plastics, Kerzner, Energy XXI, Secure Computing hit the secondary

By Sara Rosenberg

New York, Aug. 31 - Berry Plastics Corp., Kerzner International Ltd., Energy XXI and Secure Computing Corp. all freed for trading on Thursday, with Berry's term loan B seen in the low par's, Kerzner's term loan debt seen around the mid par's, Energy XXI's second-lien seen in the upper par's and Secure Computing's term loan seen wrapping around 101.

Berry Plastics' credit facility broke for trading during market hours, with the $675 million seven-year term loan B quoted at par bid, par ¼ offered, according to traders.

The term loan B is priced with an interest rate of Libor plus 175 basis points. During syndication, pricing on the tranche was reverse flexed from original talk at launch of Libor plus 200 basis points.

The company's $875 million credit facility (Ba2/B+) also contains a $200 million six-year revolver with an interest rate of Libor plus 200 basis points and a 50 basis point commitment fee.

Credit Suisse, Deutsche Bank, Citigroup and JPMorgan are joint bookrunners on the deal, and Credit Suisse and Citigroup are joint lead arrangers.

Proceeds will be used to help fund the leveraged buyout of Berry by Apollo Management, LP and Graham Partners for $2.25 billion from Goldman Sachs Capital Partners and JPMorgan Partners and to help fund a tender offer for its $335 million of 10.75% senior subordinated notes due 2012.

The tender offer is set to expire on Sept. 19.

Berry Plastics is an Evansville, Ind., manufacturer and marketer of rigid plastic packaging products.

Kerzner breaks in mid par's

Kerzner's credit facility also started trading on Thursday, with the strip of funded and delayed-draw term loan B debt quoted at par 3/8 bid, par ¾ offered, according to a trader.

Both the $250 million seven-year funded term loan B and the $150 million seven-year delayed-draw term loan B are priced with an interest rate of Libor plus 300 basis points, in line with initial price talk at launch.

The company's $575 million senior secured credit facility also includes a $175 million six-year revolver with an interest rate of Libor plus 300 basis points and a 50 basis point commitment fee.

Credit Suisse and Deutsche Bank are joint lead arrangers on the deal that will be used to help fund the leveraged buyout of Kerzner by its chairman, Sol Kerzner, and its chief executive officer, Butch Kerzner. The investor group also includes Istithmar PJSC, Whitehall Street Global Real Estate LP 2005, Colony Capital LLC, Providence Equity Partners Inc. and The Related Cos. LP.

Under the purchase agreement, the group will pay $81 in cash per outstanding ordinary share. The transaction value is about $4 billion.

Other LBO financing will come from a new $2.88 billion CMBS financing facility and equity.

Kerzner is a Paradise Island, The Bahamas, developer and operator of destination resorts, luxury resort hotels and gaming properties.

Energy XXI trades in high par's

Also freeing for trading was Energy XXI's $325 million second-lien term loan, which was quoted at par 5/8 bid, 101 offered, according to a trader.

The second-lien term loan is priced with an interest rate of Libor plus 550 basis points and carries 101 call protection for one year. During syndication, the term loan was upsized from $300 million.

BNP Paribas and RBS Securities are the lead banks on the deal.

Proceeds are being used to fund the acquisition of oil and gas properties from Castex Energy Inc.

Energy XXI is a Hamilton, Bermuda-based oil and gas exploration and production company.

Secure Computing wraps around 101

Last on the list of deals to hit the secondary Thursday was Secure Computing, with the $90 million seven-year first-lien term loan quoted at par ¾ bid, 101 offered, according to a trader.

The term loan is priced with an interest rate of Libor plus 325 basis points. During syndication, pricing on the tranche firmed up at the tight end of original talk of Libor plus 325 to 350 basis points.

Secure Computing's $110 million senior secured credit facility (B2/B) also contains a $20 million six-year revolver with an interest rate of Libor plus 325 basis points. Pricing on this tranche also firmed up during syndication at the low end of original guidance of Libor plus 325 to 350 basis points.

Prior to the deal's Aug. 10 bank meeting, the expectation was that there would be a $25 million 71/2-year second-lien term loan included in the capital structure based on a commitment letter that was filed with the Securities and Exchange Commission, which would have brought the total deal size to $135 million.

However, because Secure Computing generated more cash than was expected, the need for that second-lien term loan was eliminated.

Citigroup and UBS are joint lead arrangers and joint bookrunners on the deal, with Citi also administrative agent and UBS syndication agent.

Proceeds will be used to fund the acquisition of CipherTrust, Inc. for $273.6 million, which is comprised of $185 million in cash, 10 million shares of Secure Computing common stock and a $10 million seller note that is subject to certain performance obligations.

Secure Computing is a San Jose, Calif., developer of network security solutions. CipherTrust is an Alpharetta, Ga., provider of messaging security.

Land O'Lakes closes

Land O'Lakes, Inc. closed on its $225 million five-year amended and restated secured revolving credit facility (Ba2/BB+) that carries an initial interest rate of Libor plus 125 basis points, according to an 8-K filed with the Securities and Exchange Commission Thursday.

JPMorgan acted as the lead bank on the deal.

The new facility replaces the company's $200 million revolver that was scheduled to terminate in January 2007.

Land O'Lakes is an Arden Hills, Minn., dairy co-op.

© 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.