TransUnion tweaks deal, breaks; Citgo upsizes; Styron allocating soon; Guardian firms structure

By Sara Rosenberg

New York, June 10 - TransUnion came out with a few more changes to its credit facility, including modifying tranche sizes, firming pricing at the wide end of talk and adding a step-down to the term loan, and then proceeded to allocate and free up for trading.

In other news, Citgo Petroleum Corp. increased the amount of term loan debt it will be getting and upsized its revolver, Styron is getting ready to give out allocations on its credit facility, and Guardian Health Services came out with a final structure on its bank deal.

Also, Michael Foods Inc. is holding off on circulating price talk on its credit facility until the transaction is actually presented to lenders early next week, while Charles River Laboratories International Inc. disclosed expected initial pricing on its proposed term loan A.

TransUnion modifies sizes

TransUnion revised tranching on its credit facility, resulting in an overall downsizing to the deal (Ba3/BB-) to $1.15 billion from $1.19 billion, according to a market source.

Specifically, the term loan was upsized to $950 million from $940 million and the revolver was downsized to $200 million from $250 million.

The revolver reduction was done because the company decided it had sufficient liquidity with a smaller sized facility, the source explained.

Deutsche Bank, Bank of America, JPMorgan and Credit Suisse are the lead banks on the credit facility, with Deutsche the left lead.

TransUnion firms pricing

Also on Thursday, TransUnion finalized pricing on its credit facility, with the term loan and the revolver both ending up priced at Libor plus 500 basis points, and a step-down was added to the term loan, under which the spread will drop to Libor plus 475 bps when net senior secured leverage is 2.75 times, the source remarked.

Previously, the term loan had been talked at Libor plus 475 bps to 500 bps after being flexed up from initial talk of Libor plus 375 bps to 400 bps

The term loan includes a 1.75% Libor floor and 101 soft call protection for one year and was sold at an original issue discount of 981/2.

When price talk on the term loan was initially increased, the original issue discount widened from the 99 area and the soft call protection was added.

TransUnion breaks

Following these final revisions, TransUnion's credit facility hit the secondary market, with the term loan quoted at 99 bid, 99½ offered on the break and then moving up to 99¼ bid, 99¾ offered, a source said.

Proceeds from the credit facility will be used to help fund Madison Dearborn Partners LLC's acquisition of a 51% interest in the company from the Pritzker family.

Other financing will come from $645 million of eight-year notes, which priced on Thursday at par to yield 11 3/8%.

Closing of the transaction is subject to the satisfaction of customary conditions and regulatory approvals.

TransUnion is a Chicago-based provider of credit and information management.

Citgo revises structure

Citgo reworked its credit facility by increasing the amount of term loan debt it is marketing and modifying pricing, according to a market source.

The company is now planning a $500 million to $550 million five-year term loan that is talked at Libor plus 600 bps and a $500 million seven-year term loan that is talked at Libor plus 700 bps.

Both terms loans have a 2% Libor floor and are being offered at an original issue discount of 98, the source said.

Previously, the company was only in market with a $300 million five-year term loan that was being talked at Libor plus 350 basis points with a 1.75% Libor floor and an original issue discount of 981/2.

Citgo lifts revolver

As for the Citgo's revolver, that was increased to $750 million from $700 million and pricing was raised to Libor plus 450 bps from Libor plus 325 bps, the source continued.

Proceeds from the now up to $1.8 billion senior secured credit facility (Ba2/BB+/BB+) will be used to refinance existing debt.

BNP Paribas, RBS and UBS are the lead banks on the deal, with BNP the left lead.

Citgo is a Houston-based refiner and marketer of transportation fuels, lubricants, petrochemicals and other industrial products.

Styron readies allocations

Styron's $1.04 billion credit facility (B2/B+) is expected to allocate shortly, with the target being for it to happen on Friday, according to a market source.

The facility consists of a $240 million revolver and an $800 million first-lien term loan.

Pricing on the term loan is Libor plus 575 bps with a 1.75% Libor floor and an original issue discount of 98.

During syndication, the term loan was upsized from $675 million as the company eliminated a $125 million second-lien term loan from its capital structure, pricing was flexed up from the Libor plus 550 bps area and, prior to that, from Libor plus 475 bps, the discount was revised from 98½ to 99 guidance and, prior to that, from just 99, and call protection was added.

The second-lien term loan that was canceled was being talked at Libor plus 775 bps with a 1.75% Libor floor and an original issue discount in the 98 to 99 area. The tranche was going to carry call protection of 103 in year one, 102 in year two and 101 in year three.

Styron lead banks

Deutsche Bank, Barclays and HSBC are the lead banks on Styron's credit facility that will be used to help fund its buyout by Bain Capital from Dow Chemical for $1.63 billion.

Under the agreement, Dow Chemical has an option to receive up to 15% of the equity of Styron as part of the sale consideration.

The transaction is expected to close by August, subject to the completion of customary conditions and regulatory approvals.

Styron is a diversified chemicals and plastics company that is expected to have $3.5 billion in revenue based on 2009.

Guardian Health sets terms

Guardian Health Services finalized terms on its $90 million credit facility, with pricing on the entire deal set at Libor plus 475 bps with a 1.5% Libor floor and an original issue discount of 98, according to a market source.

Tranching on the facility is comprised of a $15 million revolver and a $75 million term loan, the source said.

GE Capital is the lead bank on the deal that will be used to fund an acquisition.

Guardian Health Services is a Hickory, N.C.-based provider of comprehensive services for patients in their own home.

Michael Foods talk to emerge at launch

Michael Foods is expecting to announce price talk on its proposed $865 million credit facility at the deal's bank meeting, which is scheduled for Monday at 1 p.m. ET, according to a market source.

As was previously reported, tranching on the facility is comprised of a $790 million term loan and a $75 million revolver

Bank of America, Goldman Sachs and Barclays are the lead banks on the deal, with Bank of America the left lead.

When the deal was first announced, only Bank of America and Goldman were listed as leads, but, shortly thereafter, Barclays signed on as well.

Michael Foods selling notes

In addition to the new credit facility, Michael Foods is planning $430 million of senior unsecured notes that will be led by the same three banks, but with Goldman acting as the left lead.

Proceeds from the credit facility and the notes will be used to help fund the buyout of the company by GS Capital Partners from Thomas H. Lee Partners LP in a transaction valued at $1.7 billion that is expected to close in the next two months, subject to customary conditions.

Following completion of the transaction, Thomas H. Lee will retain an ownership stake of about 20% in the company.

In connection with the buyout, the company is refinancing its existing bank debt and tendering for its $150 million of 9¾% senior discounted notes due 2013 and roughly $154 million of 8% senior subordinated notes due 2013. The tender offers will expire at midnight ET on July 2.

Michael Foods is a Minnetonka, Minn.-based producer and distributor of food products to the foodservice, retail and food ingredient markets.

Charles River expected pricing

Charles River Laboratories anticipates that its approximately $1 billion five-year term loan A will carry initial pricing of Libor plus 275 bps, according to a DEFA14A filed with the Securities and Exchange Commission on Thursday.

Pricing on the term loan A and the company's proposed $250 million five-year revolver will be based on leverage.

If the leverage ratio is 2.75 times, pricing is Libor plus 275 bps, if the ratio is 2.0 times to 2.75 times, pricing is Libor plus 250 bps, if the ratio is 1.25 times to 2.0 times, pricing is Libor plus 225 bps, and if the ratio is less than 1.25 times, pricing is Libor plus 200 bps.

Also, the commitment fee on the revolver can range from 25 bps to 50 bps based on leverage.

JPMorgan and Bank of America are the lead banks on the $1.25 billion senior secured credit facility (Ba1/BBB-).

Charles River funding acquisition

Proceeds from Charles River's credit facility will be used to help fund the acquisition of WuXi PharmaTech Inc. for $21.25 per WuXi American Depositary Share. Each WuXi share will be exchanged for $11.25 in cash and $10 of Charles River common stock determined by an exchange ratio. The transaction is valued at $1.6 billion.

Adjusted combined leverage will be 3.3 times.

Closing is expected by the fourth quarter, subject to approval by each company's shareholders and the satisfaction of customary conditions and regulatory approvals.

Charles River is a Wilmington, Mass.-based provider of research models and associated services and of preclinical drug development services. WuXi is a China-based drug research and development outsourcing company.

New Development closes

New Development Holdings LLC, a subsidiary of Calpine Corp., closed on its $1.4 billion credit facility (Ba3/BB-), consisting of a $1.3 billion seven-year amortizing term loan and a $100 million revolver.

Pricing on the revolver and the term loan is Libor plus 550 bps. The term loan has a 1.5% Libor floor and 101 soft call protection for one year and was sold at an original issue discount of 98.

During syndication, pricing on the term loan was flexed up from Libor plus 350 bps and the call protection was added.

Credit Suisse, Citigroup and Deutsche Bank acted as the lead banks on the deal that will be used to help fund Calpine's purchase of 4,490 MW of power generation assets from Pepco Holdings Inc. for $1.65 billion plus adjustments.

Funding is contingent on completion of the acquisition.

Calpine is a Houston-based power generation company.

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