Ford Credit mega-deal drives by; Huntsman, Zayo, Durr price; Abitibi, West Corp., PHI slate offerings

By Paul Deckelman and Paul A. Harris

New York, Sept. 14 - The high-yield primary pricing parade continued on Tuesday, led by an opportunistically timed, quickly shopped $1 billion behemoth of an offering from Ford Motor Co.'s auto-loan finance arm, Ford Motor Credit Co. LLC

Also pricing was Huntsman International LLC's $350 million offering of 101/2-year senior subordinated notes and Zayo Group, LLC/Zayo Capital Inc.'s $100 million add-on to the Louisville, Colo.-based telecommunications infrastructure company's secured notes due 2017. German borrower Durr AG came to market with a euro-denominated deal.

Meanwhile, AbitibiBowater, Inc. announced plans for a $750 million offering of secured notes. Also announcing new deals were FTI Consulting, Inc., PHI Inc. and Universal Health Services, Inc.

High-yield syndicate sources also heard that West Corp. plans a $500 million note offering, and Beverages & More, Inc. plans to uncork a $125 million secured offering having begun a roadshow to market it to investors. Two prospective issuers already on the forward calendar, Visant Holding Corp./Visant Corp. and NBTY Inc., also began shopping around their transactions to possible buyers.

Traders said Huntsman's new bonds firmed smartly when they began trading in the secondary; Ford Credit was up a little, but Zayo's smallish add-on deal was not seen in the aftermarket.

The traders said that as had been the case on Monday, new-deal doings dominated the secondary, but major performance indexes were still mostly higher.

Ford Credit's $1 billion drive-by

Three issuers raised a combined $1.44 billion on Tuesday, each bringing a single junk-rated dollar-denominated tranche of notes.

Ford Motor Credit priced a $1 billion issue of 5 5/8% five-year senior notes at 99.466 to yield 5¾%.

The yield printed on top of the price talk.

Deutsche Bank Securities, Goldman, Sachs & Co., HSBC Securities and Morgan Stanley & Co. Inc. were the joint bookrunners.

The notes traded higher in the aftermarket, according to a hedge fund manager who spotted the notes at 99¾ bid, 100 1/8 offered.

Huntsman prices 101/2-year deal

Elsewhere on Tuesday, Huntsman International priced a $350 million issue of 101/2-year senior subordinated notes (B3/B-) at par to yield 8 5/8%.

The yield printed at the tight end of the 8¾% area price talk.

Goldman Sachs was the left lead bookrunner for the debt-refinancing deal. Bank of America Merrill Lynch, Barclays Capital Inc., Citigroup Global Markets Inc., Credit Suisse Securities, HSBC and J.P. Morgan Securities Inc. were the joint bookrunners.

Zayo taps on top of talk

Meanwhile, Zayo Group and Zayo Capital priced a $100 million add-on to their 10¼% first-lien senior secured notes due March 15, 2017 (B2/B-) at 103.

The reoffer price came on top of the price talk.

Morgan Stanley, RBC Capital Markets Corp. and SunTrust Robinson Humphrey Inc. are the joint bookrunners.

Proceeds, as well as a $35 million draw on an equity commitment from the shareholders of the ultimate parent, CII, will be used to fund the acquisition of American Fiber Systems and for general corporate purposes.

The original $250 million issue priced at 98.779 to yield 10½% on March 5, 2010.

Universal Health's $250 million

Universal Health Services plans to price a $250 million offering of eight-year senior notes (B1/B+/) on Wednesday, according to a market source.

JPMorgan and Deutsche Bank are the leads.

Proceeds will be used to help fund the acquisition of Psychiatric Solutions, Inc.

Visant leads roadshows

The calendar filled with roadshows on Tuesday.

However, most of the roadshows will be brief; the lion's share of the deals announced Tuesday are expected to price before the end of the week.

Visant is in the market with a $750 million offering of seven-year senior notes (Caa1/B-).

An investor meeting took place in New York on Tuesday. Marketing is expected to continue through much of the week.

Goldman Sachs is the left lead bookrunner.

NBTY's $650 million

NBTY began a roadshow on Tuesday for its $650 million offering of eight-year senior notes (/B/).

The roadshow wraps up on Sept. 21, and the deal is set to price on Sept. 22.

Bank of America Merrill Lynch, Barclays and Credit Suisse are the joint bookrunners for the leveraged buyout-financing deal.

FTI starts Wednesday

Elsewhere, FTI Consulting will begin a brief roadshow on Wednesday for its $350 million offering of 10-year senior notes (existing ratings Ba2/BB).

The roadshow wraps up on Thursday, and the deal is set to price Thursday afternoon.

Bank of America Merrill Lynch, JPMorgan and Goldman Sachs are the joint bookrunners for the debt-refinancing and general corporate purposes deal.

PHI starts roadshow

PHI began a brief roadshow on Tuesday for its $300 million offering of eight-year senior unsecured notes.

The deal is set to price Thursday.

UBS Investment Bank is the bookrunner for the debt-refinancing and general corporate purposes deal.

Beverages & More plans $125 million

Finally, Beverages & More began a roadshow on Tuesday for its $125 million offering of four-year senior secured notes (expected ratings Caa1/B-).

The roadshow is expected to wrap up on Monday.

Jefferies & Co. is the bookrunner for the Rule 144A-for-life deal.

Proceeds will be used to redeem all of the company's existing senior secured notes, repay a portion of its existing revolver and redeem a portion of the parent's senior secured PIK notes.

Huntsman moves higher

A trader said that Huntsman International's new 8 5/8% senior subordinated notes due 2021 "did OK" when they were freed for secondary dealings, quoting the Salt Lake City-based chemical company's $350 million deal at 102½ bid, 102¾ offered.

At another desk, a trader said the Huntsmans had gotten as good as 102¾ bid.

That was up from the par level where the bonds priced earlier in the session.

Zayo aftermarket no-show

Traders meantime did not see any trace of Zayo Group's $100 million add-on offering of 10¼% senior secured notes due 2017.

Those bonds had priced earlier at 103 bid.

Ford Credit moves up slightly

Ford Motor Credit's 5 5/8% notes due 2015 were seen having moved up a little after the Dearborn, Mich.-based auto finance company's mega-deal went into the aftermarket.

A trader said that the bonds had advanced to 99¾ bid, 99 7/8 offered from their 99.466 issue price.

He marveled at the fact that the bonds came in yielding under 6%. "Can you believe Fords with a 5-handle coupon? Oh my God. I don't."

He added that "I never thought that I would see" a Ford or Ford-connected regular junk bond "that low."

Another trader meantime saw the new Ford Credit bonds "hovering above" the issue price, trading at 99½ bid, 99¾ offered.

Reprising a classic advertising slogan used by the No. 2 U.S. carmaker, he quipped, "Have you driven a Ford lately?"

Monday's deals keep or add to gains

Among the deals that priced on Monday, a trader said that Continental Resources, Inc.'s 7 1/8% notes due 2021 were trading around 102 ½ bid, 102 5/8 offered.

That was slightly better than the 102 3/8 bid, 102 5/8 offered level at which the Enid, Okla.-based oil and gas exploration and production company's $400 million offering - upsized from an originally announced $350 million - had traded after the drive-by deal priced at par earlier Monday.

Out of that same energy patch, a trader saw Kansas City, Mo.-based propane distributor and natural gas operator Inergy, LP's new 7% notes due 2018 traded up to 101½ bid.

That $600 million quickly shopped offering, which had priced on Monday at par, had moved up to 101 bid, 101½ offered later Monday from its par issue price, several traders said.

Oklahoma City-based oil and gas operator Chaparral Energy, Inc.'s 9 7/8% notes due 2020 were seen by a trader on Tuesday trading at 99½ bid, 99 7/8 offered, up a little from the 99 bid, 99½ offered level seen on Monday after the $300 million deal priced at 97.672 to yield 10¼%.

Although the bonds were trading nearly 2 points up from their below-par issue price, the trader opined that "it's not flying. We're a little surprised at that.

"We thought it was going to be above par. They look a little cheap to us - but it is what it is."

Away from the energy names, a trader said that Cleveland-based chemical concern PolyOne Corp.'s upsized $360 million offering of 7 3/8% notes due 2020 traded up at 102¼ bid 102½ offered. The deal - which was upsized from the originally announced $320 million - had priced at par on Monday.

He also saw Wellington, Fla.-based aircraft interiors company B/E Aerospace, Inc.'s 6 7/8% notes due 2020 trade up to 101 3/8 bid, versus Monday's aftermarket finish at 101 1/8 bid, 101¾ offered.

The $650 million drive-by issue - upsized from the originally announced $500 million - priced earlier Monday at 99.104 to yield 7%.

Market indicators stay strong

Away from the new-deal world, a trader saw the CDX North American High Yield Series 14 index unchanged on Tuesday to stay at 97 7/8 bid, 98 1/8 offered after having risen by 1/8 point Monday.

The KDP High Yield Daily index meantime rose by 13 basis points on Tuesday to finish at 72.65, on top of the 22-bps gain seen on Monday. Its yield declined by 4 bps, to 7.88%, after having plunged by 13 bps on Monday.

The Merrill Lynch High Yield Master II index rose by 0.189% on Tuesday after having improved by 0.347% on Monday. It continued to push to successive new year-to-date 2010 peak levels, ending the day at 10.387%, up from Monday's 10.179%, which had been the first time this year the index topped the psychologically significant 10% mark.

Advancing issues led decliners for a ninth consecutive session on Tuesday, with their advantage narrowing a little to seven-to-five from almost eight-to-five on Monday.

Overall activity, represented by dollar-volume levels, more than doubled on Tuesday after having fallen by 6% on Monday from the previous session.

Traders said the vast bulk of Tuesday's greatly expanded activity was trading in the new deals.

"It was almost entirely new issues, almost entirely," one of them said. Reminded of the fact that this had also been the case on Monday, he said, "That's what's going to happen - everybody and his brother is coming [with a new deal]. Everybody is lined up."

While seeing the new-issue-driven market "very strong," he added that "the only caveat would be" that major funds are likely "to start selling some of the stuff that has run quite a ways and maybe has tightened up against the curve."

A second noted, "The big story of the day is: the calendar continues to grow."

Unisys bonds continue gains

Among specific names having no new-deal connections, a trader said that "the name that's been on fire" is Unisys Corp., after several ratings agencies recently upgraded its debt.

He saw the Blue Bell, Pa.-based information technology company's 14¼% notes due 2015 having moved up to 118½ bid, 119½ offered, which he called up at least ¾ point to 1 point in the last week or so.

The company's 12½% notes due 2016 have moved up to 110¾ bid, 111¾ offered, up a point from recent levels, while its 8% notes due 2012 were trading up 1 point at a little above 103.

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