Jazz Pharmaceuticals, Kronos break; EnergySolutions down with revised guidance, Revel dips

By Sara Rosenberg

New York, June 11 - Jazz Pharmaceuticals plc reduced the size of its term loan B on Monday and then the debt freed up for trading above its original issue discount price, and Kronos Worldwide Inc. hit the secondary too.

Also in trading, EnergySolutions' term loan weakened as the company modified its adjusted EBITDA guidance lower and announced management changes, and Revel Entertainment Group LLC's term loan fell with the release of May revenue results.

Moving to the primary market, LS Power revealed price talk on its term loan, Savers Inc. zeroed in on timing for the launch of its senior secured credit facility, and U.S. Renal Care Inc. and Archway Marketing Services Inc. surfaced with new deal plans.

Jazz starts trading

Jazz Pharmaceuticals' credit facility emerged in the secondary market on Monday, with the $475 million six-year term loan B quoted at 98¾ bid, 99¾ offered, according to a market source.

The term loan B, which was downsized in the morning from $500 million since the company has more cash on its balance sheet than originally expected, is priced at Libor plus 425 basis points with a 1% Libor floor, and was sold at an original issue discount of 981/2. There is 101 soft call protection for one year.

Earlier in the syndication process, pricing was increased from talk of Libor plus 350 bps to 375 bps, the discount widened from 99 and the call protection was added.

Also with the pricing changes, the company increased amortization on the term loan to 5% in year one, 7.5% in year two, 10% in years three and four and 15% in year five, from just 1% per year previously, and the excess cash flow sweep was revised to 50% from 25%.

Jazz getting revolver

Jazz Pharmaceuticals' $575 million credit facility (Ba3/BBB-) also provides for a $100 million five-year revolver that is priced at Libor plus 400 bps with no Libor floor and was sold at an original issue discount of 99.

Pricing on the revolver was lifted from guidance of Libor plus 325 bps to 350 bps during syndication.

Barclays Capital Inc., J.P. Morgan Securities LLC and Citigroup Global Markets Inc. are leading the deal that will be used with cash on hand to fund the $650 million acquisition of EUSA Pharma.

Closing is expected this month, subject to customary conditions and regulatory approvals, including antitrust approval in the United States.

Jazz Pharmaceuticals is a Dublin, Ireland-based specialty biopharmaceutical company. EUSA is a specialty pharmaceutical company with headquarters in Langhorne, Pa., and Oxford, England.

Kronos tops OID

Kronos' credit facility was another deal to free up for trading, with its $400 million six-year senior secured term loan B quoted at 99 bid, 99½ offered, according to a source.

Pricing on the loan is Libor plus 475 bps with a 1% Libor floor, and it was sold at a discount of 981/2. There is 101 soft call protection for one year.

During syndication, the loan was downsized form $600 million, pricing flexed up from revised talk of Libor plus 425 bps and initial talk of Libor plus 375 bps, the original issue discount moved from 99 and the tenor was shortened from seven years.

The Dallas-based producer of titanium dioxide products is also getting a $125 million ABL revolver as part of its $725 million credit facility. The revolver was not being syndicated.

Wells Fargo Securities LLC is leading the deal that will be used to refinance existing debt, including the company's 6½% senior secured notes due April 2013. Plans for a possible special dividend of up to $1 per share were eliminated as a result of the loan size reduction.

EnergySolutions slides

In more trading news, EnergySolutions' term loan dropped to 96½ bid, 98½ offered, from 99 bid, par offered as the company revealed that it now expects adjusted EBITDA for 2012 to be in the range of $130 to $140 million, down from prior guidance of $150 to $160 million, according to a trader.

The company attributed the revision to a continued slowdown in shipments to Clive in both the government and commercial businesses, expected delay in the resolution of the Salt Waste project issues until 2013 and slower than planned realization of cost savings.

In addition, the company announced the appointment of David Lockwood, a current board member, as chief executive officer and president, replacing Val John Christensen, who will remain a strategic advisor.

And, Greg Wood was named as the new executive vice president and chief financial officer, replacing William R. Benz.

EnergySolutions is a Salt Lake City-based provider of nuclear services.

Revel retreats

Revel's term loan B weakened to 89 bid, 90½ offered, from 92¼ bid, 92¾ offered on Friday in connection with the emergence of May revenue results, according to a trader.

For the month of May, the company had total revenue of $13.93 million, and year-to-date revenue is $27.56 million, the New Jersey Division of Gaming Enforcement reported on Monday.

Revel, a gaming and entertainment company, commenced operations on March 28 and opened to the public on April 2.

BWIC surfaces

A roughly $171 million Bid Wanted In Competition (BWIC) was announced on Monday afternoon, and investors were asked to place their bids by 10 a.m. ET on Wednesday, according to a trader.

The portfolio includes about 55 issuers.

Some of the larger pieces of debt being offered in the BWIC are TXU Energy Co. LLC's extended term loan, Univision Communications' extended term loan, Biomet Inc.'s term loan B, Flextronics International's term loan A, Catalina Marketing Corp.'s term loan B, Grosvenor Capital Management Holdings LLP's extended term loan C, Mediacom LLC's term loan C, Community Health Systems Inc.'s extended term loan and Consolidated Communication Inc.'s extended term loan, the trader added.

LS Power sets talk

Over in the primary, LS Power held a bank meeting on Monday afternoon to launch its $750 million seven-year first-lien term loan (Ba2), and with the event, price talk was announced, according to a market source.

The loan, issued by LSP Madison Funding LLC, was launched at Libor plus 450 bps with a 1.25% Libor floor and an original issue discount of 981/2, and includes soft call protection of 102 in year one and 101 in year two, the source said.

Commitments are due during the week of June 25, the source added.

Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc. and Morgan Stanley Senior Funding Inc. are leading the deal that will refinance existing project level debt, fund reserve accounts, fund a one-time distribution to the sponsor and for general corporate purposes.

LS Power is a New York-based company that has a diversified portfolio of power generating facilities.

Savers sets meeting

Savers firmed timing on its senior secured credit facility, setting a bank meeting for 10 a.m. ET on Wednesday to launch the transaction to investors, according to a market source. Earlier sources were hearing that the meeting would be this week but specifics had been unavailable.

Also, it was revealed that the deal will include a $75 million five-year revolver in addition to the previously announced $655 million seven-year term loan B, the source said.

Goldman Sachs Lending Partners LLC, Barclays Bank plc, Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc. are leading the $730 million deal that will help fund the purchase of the company by Leonard Green & Partners LP, TPG and management from Freeman Spogli & Co.

Other funds for the transaction will come from $295 million of private unsecured notes that will be purchased by Crescent Capital Group.

Savers, a Bellevue, Wash.-based thrift store chain, expects the buyout to close in July.

U.S. Renal readies deal

U.S. Renal Care came out with plans to hold a bank meeting at 12:30 p.m. ET on Wednesday to launch a proposed $485 million credit facility, according to a market source.

The facility consists of a $60 million revolver, a $305 million covenant-light first-lien term loan and a $120 million covenant-light second-lien term loan, the source said.

Barclays Capital Inc., RBC Capital Markets LLC and Goldman Sachs & Co. are leading the deal that will help fund the acquisition of the company by Leonard Green & Partners L.P. from Cressey & Co.

U.S. Renal is a Dallas-based owner, operator, and developer of dialysis centers.

Archway coming soon

Also joining the calendar with a planned Wednesday bank meeting was Archway Marketing, with its deal slated to help fund its purchase by Investcorp from Tailwind Capital, Black Canyon Capital and management, a source said.

The $175 million credit facility is comprised of a $30 million five-year revolver, a $35 million six-year delayed-draw for three years term loan and a $110 million six-year term loan, the source continued.

GE Capital Markets and ING Financial Markets LLC are leading the transaction.

Archway, a Rogers, Minn.-based marketing logistics and fulfillment services company, will have senior leverage of 3.7 times and total leverage of 5.2 times, the source added.

© 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.