HHI breaks; Ford rises on paydown; CF sets talk; EMSC tweaks deal; RCN zeroing in on timing

By Sara Rosenberg

New York, March 29 - HHI Holdings LLC's credit facility allocated and freed up for trading during Monday's market hours, with the term loan quoted above its original issue discount price, and Ford Motor Co.'s bank debt was stronger with repayment news.

Over in the primary market, CF Industries Holdings Inc. came out with official price talk on its credit facility as the transaction was presented to lenders, and Emergency Medical Services Corp. (EMSC) revealed changes to its new deal.

In other news, RCN Corp. narrowed down anticipated timing on the retail launch of its proposed credit facilities, Securus Technologies Inc. is gearing up to come to market with a refinancing facility, RadNet Inc. is oversubscribed and expected at the tight end of talk, and Shearer's Foods Inc. and Lyondell Chemical Co. are getting ready to give out allocations on their new deals.

HHI frees to trade

HHI Holdings' credit facility hit the secondary market in the morning, with the $200 million term loan B (B3/B+) seen trading above the discount price at which it was sold during syndication, according to a trader.

The term loan B was quoted at 98 bid, 99 offered on the break and then it moved up to 99½ bid, par offered, the trader said.

Pricing on the term loan is Libor plus 750 basis points with a 3% Libor floor, and it was sold at an original issue discount of 97.

During syndication, the Libor floor firmed at the wide end of initial guidance of 2.5% to 3%, and prior to launch, the term was reduced form an originally expected size of $240 million.

HHI getting revolver

HHI Holdings' $340 million credit facility also includes a $140 million ABL revolver.

Bank of America and Credit Suisse are the lead banks on the deal.

Proceeds will be used to refinance existing debt and to fund a dividend payment.

HHI is a Royal Oak, Mich.-based supplier of highly engineered metal forgings and machined components, wheel bearings, and powdered metal engine and transmission components for automotive and industrial customers.

Ford trades up

Ford's bank debt gained some ground in trading on Monday as the company revealed plans to repay $3 billion of its revolving credit facility borrowings on April 6, according to traders.

One trader had the term loan B-1 quoted at 97 bid, 97½ offered, up from 96½ bid, 97 offered, the term loan B-2 quoted at 96 bid, 97 offered, up from 95½ bid, 96½ offered and the revolver quoted at 86½ bid, 88½ offered, up from 86 bid, 88 offered.

Meanwhile, a second trader had the term loan B-1 quoted at 96 7/8 bid, 97 3/8 offered, up from 96½ bid, 97 offered.

Ford said in an 8-K filed with the Securities and Exchange Commission that it is paying down the debt as a result of the improved state of the capital markets and global economic conditions.

At Dec. 31, the Dearborn, Mich.-based manufacturer and distributor of automobiles had $7.9 billion used under its $8.1 billion revolver.

CF Industries talk emerges

Moving to the primary market, CF Industries held a bank meeting on Monday to kick off syndication on its proposed $2.3 billion credit facility, and in connection with the launch, price talk was announced, according to a market source.

The bank meeting was said by the source to have gone very well, with it being a "packed house."

Both the $2 billion five-year term loan B and the $300 million five-year revolver are being talked at Libor plus 350 basis points with a step-down to Libor plus 300 bps upon the issuance of at least $750 million of equity to repay debt, the source said. The revolver pricing can also fluctuate based on a leverage grid.

The company is expected to approach the capital markets as soon as possible, meaning probably sometime in the next couple weeks, the source continued.

CF Industries discount guidance

CF Industries' term loan B is being offered at an original issue discount of 991/2, while the revolver is being offered with upfront fees and no discount, the source remarked.

Additionally, both tranches include a 1.5% Libor floor.

By comparison, according to the commitment letter that was previously filed with the SEC, both tranches were expected to be priced at Libor plus 350 bps with a 2% Libor floor and an original issue discount of 981/2.

Only about $1.2 billion of the term loan B is being syndicated as the two lead banks - Morgan Stanley and the Bank of Tokyo-Mitsubishi UFJ - have opted to hold onto the other $800 million, the source added.

Financial covenants under the credit facility include a minimum interest coverage ratio and a maximum leverage ratio.

CF Industries buying Terra

Proceeds from CF Industries' credit facility will be used to help fund the acquisition of Terra Industries Inc. for $37.15 in cash and 0.0953 of a share of its common stock per Terra share. The transaction is valued at about $4.7 billion.

CF Industries commenced the exchange offer for Terra's shares on March 5, and under the definitive agreement, that offer will expire on April 2.

In addition to the credit facility, CF Industries has also received a commitment for an up to $1.75 billion one-year bridge loan priced initially at Libor plus 800 bps with a 2% Libor floor. After 30 days, the spread will increase by 100 bps and by an additional 100 bps each 30 days thereafter.

Following completion of the exchange offer, the company plans to do an about $1 billion common stock offering and an offering of $1.6 billion senior notes, with proceeds being used to reduce borrowings under the bridge loan and the term loan B, according to SC TO-T/A filed with the SEC on Monday.

CF Industries is a Deerfield, Ill.-based producer and distributor of nitrogen and phosphate fertilizer products. Terra is a Sioux City, Iowa-based producer and marketer of nitrogen and methanol products.

EMSC reworks facility

Emergency Medical Services came out with a number of changes to its credit facility, including increasing the size and modifying pricing, according to sources.

Under the revisions, the revolver was upsized to $150 million from $125 million, while the term loan size was left unchanged at $425 million, sources said.

Pricing on the two tranches ended up in line with initial talk at Libor plus 300 bps with no Libor floor, but a step-down was added under which the spread will drop to Libor plus 275 bps when leverage is less than 1.2 times.

EMSC cuts OID

In addition, Emergency Medical Services' tightened the original issue discount on its term loan to 99½ from 99, sources continued.

The revolver has a 50 bps unused fee.

Bank of America, Barclays and JPMorgan are the lead banks on the now $575 million, up from $550 million, deal (Baa3/BB+).

Proceeds will be used to refinance existing debt.

Emergency Medical Services is a Greenwood Village, Colo.-based ambulance and facility-based physician services company.

RCN launch weeks away

RCN is expected to hold the retail bank meeting for its proposed $885 million in new credit facilities sometime in early May, as the go-shop period under its buyout agreement is expiring on April 14, according to a market source.

As was announced earlier this month, the Herndon, Va.-based broadband services provider, is being acquired by ABRY Partners for $15 per share. The transaction is valued at $1.2 billion, including the assumption of debt.

Closing on the buyout is expected in the second half of this year, subject to receipt of stockholder approval, regulatory approvals and satisfaction of other customary conditions. The transaction is not subject to any financing condition.

RCN proposed facilities

To help fund the buyout, RCN will be getting two facilities: a $620 million deal for its cable business, consisting of a $40 million five-year revolver and a $580 million six-year term loan, and a $265 million facility for its fiber business, consisting of a $25 million five-year revolver and a $240 million six-year term loan.

Expected ratings on the cable facility are high single-Bs and expected ratings on the fiber facility are mid single-Bs.

SunTrust, GE Capital and Société Générale are the bookrunners on the deal, with SunTrust the left lead and the administrative agent.

Other financing for the transaction will come from equity.

Securus preps deal

Securus Technologies is scheduled to hold a bank meeting on Tuesday to launch a proposed $210 million credit facility that will be used to refinance existing debt and for general corporate purposes, according to a market source.

The facility consists of a $40 million revolver and a $170 million term loan, the source said.

Jefferies is the lead bank on the deal.

Securus is a Dallas-based provider of inmate communications services and offender and case management software design.

RadNet expected at low end

RadNet's $275 million six-year term loan is anticipated to come at the low end of the current Libor plus 375 bps to 400 bps guidance since the deal is oversubscribed ahead of the Tuesday commitment deadline, according to a market source.

The term loan carries a 2% Libor floor and is being offered at an original issue discount in the 99 area.

The company's $375 million credit facility (Ba3/B+) also includes a $100 million five-year revolver talked at Libor plus 375 bps with a 2% Libor floor and an upfront fee of two points.

Barclays Capital, GE Capital Markets, Deutsche Bank, RBC Capital Markets and Jefferies are the lead banks on the deal.

Security is a first-priority interest in all of the company's tangible and intangible assets, including, but not limited to, a stock pledge of all of its current and future wholly owned domestic subsidiaries.

RadNet refinancing debt

Proceeds from RadNet's new credit facility will be used to help refinance its existing revolver due 2011, term loan B due 2012 and second-lien loan due 2013. The new revolver is expected to be undrawn at close.

Other funding for the refinancing will come from a $210 million senior unsecured notes offering, and completion of the credit facility is contingent on completion of the notes.

The refinancing transaction would extend the maturity of the company's debt, increase the size of its revolver by about $45 million and further enhance liquidity by adding about $25 million of cash to its balance sheet.

Closing on the refinancing is expected to take place in early April.

RadNet is a Los Angeles-based provider of diagnostic imaging services.

Shearer's readies allocations

Shearer's Foods is expected to allocate and free up for trading its $139 million credit facility (Ba3/B) on Tuesday, according to a market source.

The facility consists of a $20 million revolver and a $119 million term loan, with both tranches priced at Libor plus 475 bps with a 2% Libor floor, and both were sold at an original issue discount of 98.

Jefferies and BMO are the lead banks on the deal, with Jefferies the left lead.

Proceeds will be used to help fund the acquisition of Snack Alliance Inc., a contract pack and private label snack producer.

Shearer's, which is majority owned by Mistral Equity Partners, is a Brewster, Ohio-based producer and distributor of contract pack and private label seasoned snack foods.

Lyondell breaking Tuesday

Another deal that is expected to break for trading on Tuesday is Lyondell Chemical's credit facility, according to sources, who said that originally the event was supposed to take place on Monday but it got pushed off.

The $2.25 billion credit facility consists of a $1.75 billion ABL revolver and a $500 million six-year senior secured term loan B (Ba3).

Pricing on the term loan B is Libor plus 400 bps with a 1.5% Libor floor, and it was sold at an original issue discount of 99.

During syndication, the term loan B was downsized from $1 billion as the company's bond offering was increased to $2.75 billion from $2.25 billion, pricing was reduced from Libor plus 425 bps, the Libor floor was lowered from 2% and the financial covenants, including a maximum first-lien leverage ratio and a minimum interest coverage ratio, were eliminated.

Lyondell funding exit

Proceeds from Lyondell's credit facility, the new senior secured notes, a new European securitization facility and a $2.8 billion rights offering will be used to repay and replace existing debt when the company exits bankruptcy.

The notes, comprised of a $2.25 billion dollar tranche and a €375 million euro tranche, priced last Wednesday at par to yield 8%.

Joint bookrunners on the term loan B are UBS, Bank of America, Barclays, Citigroup, Credit Suisse, Deutsche Bank, JPMorgan, Morgan Stanley and Wells Fargo, with UBS the left lead. Citigroup is the left lead on the ABL revolver.

Lyondell is a U.S. subsidiary of LyondellBasell Industries AF SCA, a Netherlands-based polymer, petrochemicals and fuels company.

Multi Packaging narrows down OID

Multi Packaging Solutions Inc. is talking its $215 million six-year term loan with an original issue discount of 99, as opposed to in the 98½ to 99 context that was floating around the market prior to the deal's launch, according to a market source.

As was previously reported, price talk on the term loan is Libor plus 425 bps with a 1.75% Libor floor.

The company's $245 million credit facility (B2) also includes a $30 million five-year revolver that is being talked at Libor plus 400 bps with an upfront fee of 99, the source said.

When word of the new deal first hit the market, it was said that the revolver would be sized at $25 million and the term loan would be sized at $220 million, but by the time of Friday's bank meeting, $5 million had been shifted between the two tranches.

Wells Fargo and UBS are the lead banks on the deal that will be used by the New York-based entertainment packaging company to refinance existing debt and to fund a dividend payment.

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