Post term loan rises on paydown news; DTZ reworks deal; Ancestry, Delta, PowerTeam launch

By Sara Rosenberg

New York, Aug. 10 – Post Holdings Inc.’s term loan B was a bit stronger in the secondary market on Monday after the company surfaced with plans to refinance a portion of the debt with proceeds from the sale of senior unsecured notes and equity.

Moving to the primary market, DTZ (DTZ U.S. Borrower LLC and DTZ Aus HoldCo Pty Ltd.) reduced pricing on its term loan and widened the issue price on the repricing portion of the transaction.

Also, Ancestry.com, Delta Air Lines Inc. and PowerTeam Services all launched new deals to investors during the session.

Post gains ground

Post Holdings’ term loan B headed higher in trading on Monday on news of a partial paydown with proceeds from the issuance of $1.2 billion of senior unsecured notes and $275 million of new equity, according to a trader.

The loan was quoted at 99 5/8 bid, 100 1/8 offered, up from 99˝ bid, par offered, the trader said.

In addition to repaying some term loan borrowings, proceeds from the notes will be used for general corporate purposes, which may include potential future acquisitions, working capital and capital expenditures.

The term loan repayment is expected to total $1.2 billion, which would leave about $374 million of term loan B borrowings outstanding, the company disclosed in an 8-K filed with the Securities and Exchange Commission.

Pro forma for the transaction, net leverage will be 5.3 times, based on LTM third quarter pro forma adjusted EBITDA of $754 million, including $50 million in expected synergies from the MOM Brands acquisition.

Post is a St. Louis-based manufacturer, distributor and marketer of ready-to-eat cereal products.

DTZ changes emerge

Switching to the primary, DTZ trimmed pricing on its $1,805,000,000 first-lien term loan due Nov. 4, 2021 to Libor plus 325 basis points from Libor plus 375 bps and kept the 1% Libor floor and 101 soft call protection for six months intact, according to a market source.

The term loan includes $1,055,000,000 in incremental debt that will be used to fund the acquisition of Cushman & Wakefield, and the remainder will reprice the company’s existing first-lien term loan from Libor plus 450 bps with a 1% Libor floor.

Original issue discount talk on the incremental loan was unchanged at 99.5, but the repricing is now offered at 99.75 instead of par, the source said.

Commitments were due on Monday.

Along with the term loan, the company plans to get a $175 million incremental multi-currency revolver due Nov. 4, 2019, bringing the total revolver size to $375 million.

DTZ lead banks

UBS AG, J.P. Morgan Securities LLC, Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc., Morgan Stanley Senior Funding Inc., Credit Agricole Securities (USA) Inc., Mizuho Securities USA Inc. and HSBC Securities (USA) Inc. are leading DTZ’s bank debt.

Closing on the Cushman & Wakefield acquisition is expected by year-end, subject to customary conditions.

DTZ is a Chicago-based property services company. Cushman & Wakefield is a New York-based real estate services company. The combined company will operate under the Cushman & Wakefield brand.

Ancestry.com holds call

Ancestry.com emerged in the morning with plans to hold a call at 2 p.m. ET to launch an $835 million senior secured credit facility (B), a market source said.

The facility consists of a $100 million five-year revolver talked at Libor plus 350 bps to 375 bps with a leverage-based step-down and no Libor floor and a $735 million seven-year covenant-light term loan B, talked at Libor plus 375 bps to 400 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, the source continued.

Commitments are due on Friday and closing is targeted for later this month.

Morgan Stanley Senior Funding Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Goldman Sachs Bank USA and RBC Capital Markets are leading the deal that will be used to refinance existing term loan B-1 and B-2 borrowings, to fund a dividend distribution and for general corporate purposes.

Ancestry.com is a Provo, Utah-based online family history resource.

Delta reveals guidance

Delta Air Lines held its lender call on Monday morning, and in connection with the event, talk on its $500 million seven-year term loan B emerged Libor plus 250 bps with a 0.75% Libor floor, an original issue discount of 99 to 99.5 and 101 soft call protection for six months, according to a market source.

The company’s $2 billion credit facility (BBB) also includes a $1.5 billion five-year revolver.

Commitments are due on Aug. 17, the source said.

Barclays, J.P. Morgan Securities LLC, Bank of America Merrill Lynch, BBVA, BNP Paribas Securities Corp., Citigroup Global Markets Inc., Credit Agricole, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Fifth Third Bank, Goldman Sachs Bank USA, Wells Fargo Securities LLC and UBS AG are leading the credit facility that will be used with $500 million of other new debt financing and cash from the balance sheet to refinance an existing revolver due 2016 and a term loan B due 2017, to pay related fees and expenses and for general corporate purposes.

Total adjusted debt to EBITDAR is 1.4 times and net adjusted debt to EBITDAR is 1 times.

Delta is an Atlanta-based airline company.

PowerTeam discloses talk

PowerTeam Services held a call in the morning to launch a fungible $40 million add-on first-lien term loan that is talked at Libor plus 325 bps with a 1% Libor floor and an original issue discount of 99.026, a market source remarked.

The spread and floor on the add-on term loan matches existing first-lien term loan pricing.

The add-on and the existing first-lien term loan are getting 101 soft call protection for six months, the source continued.

Commitments are due on Aug. 17.

Jefferies Finance LLC is leading the deal that will be used to fund an acquisition.

PowerTeam is a Cary N.C.-based provider of services to electric and gas utilities.

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