Cypress, Arterra, Midcontinent break; HD Supply Waterworks, CPM, Interface tweak deals

By Sara Rosenberg

New York, July 19 – Cypress Semiconductor Corp. upsized its term loan B and finalized pricing at the low end of guidance before hitting the secondary market on Wednesday, and Arterra Wines Canada Inc. and Midcontinent Communications freed up as well.

In other news, HD Supply Waterworks Ltd. lowered the spread on its term loan B and tightened the original issue discount, and CPM Acquisition Corp. increased the sizes of its incremental first-lien term loan and second-lien term loan.

Also, Interface Security Systems LLC reduced the size of its revolver and widened the original issue discount on the tranche as well as on its term loan, and Duravant LLC (Engineered Machinery Holdings Inc.) accelerated the commitment deadline on its credit facilities.

Additionally, Albany Molecular Research Inc. and Culligan Holding Inc. came out with price talk with launch, and Accudyne Industries, Robertshaw US Holding Corp. and Victory Capital Operating LLC joined this week’s primary calendar.

Cypress updated, trades

Cypress Semiconductor raised its senior secured term loan B due July 5, 2021 to $518,750,000 from $427.5 million and set the spread at Libor plus 275 basis points, the low end of the Libor plus 275 bps to 300 bps talk, according to a market source.

The term loan still has a 0% Libor floor, a par issue price and 101 soft call protection for six months.

After terms finalized, the B loan broke for trading on Wednesday and levels were seen at par ¼ bid, 101 offered, a trader added.

Morgan Stanley Senior Funding Inc. and Credit Suisse Securities (USA) LLC are leading the deal that will be used to reprice an existing term loan B from Libor plus 375 bps with a 0% Libor floor, and funds from the upsizing will be used to pay down term loan A borrowings.

Closing is expected on Aug. 18.

Cypress is a San Jose, Calif.-based manufacturer of mixed-signal integrated circuits.

Arterra frees up

Arterra Wines Canada’s new debt began trading too, with the $258.7 million senior secured covenant-light term loan B-1 (Ba3/BB-) due Dec. 16, 2023 quoted at par 3/8 bid, par 7/8 offered, a trader said.

Pricing on the term loan B-1 is Libor plus 275 bps with a 1% Libor floor, and it was issued at par. The debt has 101 soft call protection for six months.

The company is also getting a C$65.67 million senior secured covenant-light term loan B-2 (Ba3/BB-) due Dec. 16, 2023 priced at BA plus 300 bps with a 1% floor and issued at par. This tranche has 101 soft call protection for six months as well.

On Tuesday, pricing on the term loan B-1 was lowered from talk of Libor plus 300 bps to 325 bps and pricing on the term loan B-2 was cut from talk of BA plus 350 bps.

Morgan Stanley Senior Funding Inc. is leading the deal that will reprice an existing U.S. term loan down from Libor plus 375 bps with a 1% Libor floor and reprice an existing Canadian term loan.

Closing is expected on Friday.

Arterra, formerly known as Constellation Brands Canada, is a Mississauga, Ont.-based producer and distributor of wine brands.

Midcontinent tops par

Midcontinent Communications’ $100 million add-on term loan B and repriced term loan B also freed to trader, with levels quoted at par ¼ bid, par ¾ offered on the break and then it moved on the bid side to par 3/8 bid, par ¾ offered, according to a market source.

Pricing on the term loan B debt is Libor plus 225 bps with no Libor floor and it was issued at par.

SunTrust Robinson Humphrey Inc. is leading the deal.

The add-on will be used to refinance some notes, and the repricing will take the term loan B down from Libor plus 250 bps with no floor.

Midcontinent Communications is a Sioux Falls, S.D.-based provider of cable television, local and long-distance digital telephone service and high-speed internet access.

HD Supply reworks loan

Back in the primary market, HD Supply Waterworks cut pricing on its $1,075,000,000 seven-year first-lien term loan B (B2/B+) to Libor plus 300 bps from talk of Libor plus 325 bps to 350 bps and changed the original issue discount to 99.75 from 99.5, a market source remarked.

The term loan B still has a 1% Libor floor and 101 soft call protection for six months.

Commitments were due at 3 p.m. ET on Wednesday, moved up from Thursday, the source added.

J.P. Morgan Securities LLC, Barclays, Bank of America Merrill Lynch, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., RBC Capital Markets LLC, Goldman Sachs Bank USA, Natixis and Nomura are leading the deal that will be used with $500 million of notes, upsized from $475 million, and equity to fund the buyout of the company by Clayton, Dubilier & Rice from HD Supply Holding Inc. for $2.5 billion.

Closing is expected during HD Supply’s third quarter of fiscal 2017, subject to customary conditions, including regulatory approvals.

HD Supply Waterworks is a St. Louis-based distributor of water, sewer, storm and fire protection products.

CPM upsizes

CPM Acquisition lifted its incremental covenant-light first-lien term loan B due April 2022 to $55 million from $50 million and its covenant-light second-lien term loan due April 2023 to $120 million from $110 million, according to a market source.

As before, the first-lien term loan is talked at Libor plus 425 bps with a 1% Libor floor, an original issue discount of 99.75 and 101 soft call protection for six months, and the second-lien term loan is talked at Libor plus 825 bps with a 1% Libor floor, a discount of 99.5 and hard call protection of 103 in year one and 101 in year two.

Morgan Stanley Senior Funding Inc. and BMO Capital Markets Corp. are leading the now $175 million in senior secured term loans that will be used to repay existing debt, fund a dividend to shareholders and pay related fees. The amount of the dividend was increased with the term loan upsizings.

Recommitments/consents were due at 5 p.m. ET on Wednesday, accelerated from an original deadline of noon ET on Thursday, the source added.

Consenting first-lien term loan lenders are offered a 25 bps amendment fee.

CPM is a supplier of process equipment used for oilseed processing and animal feed production.

Interface changes surface

Interface Security Systems trimmed its five-year revolver to $60 million from $80 million, and changed the original issue discount on the revolver and on its $230 million five-year term loan to 98.5 from 99, a market source remarked.

The revolver and term loan are still priced at Libor plus 525 bps with a 1% Libor floor, and the term loan still has 101 soft call protection for one year.

Capital One is the lead on the $290 million of credit facilities that will be used to refinance existing debt. The company has $225 million of notes that come due in January 2018.

Interface, a portfolio company of SunTx Capital Partners, is a St. Louis-based provider of cloud-based managed network services and security systems.

Duravant moves deadline

Duravant accelerated the commitment deadline on its $870 million of senior secured credit facilities to 3 p.m. ET on Friday from Tuesday, a market source said.

The facilities consist of a $70 million five-year revolver (B2/B), a $565 million seven-year first-lien term loan (B2/B) that includes a $65 million delayed-draw tranche and a $235 million eight-year second-lien term loan (Caa2/CCC+) that includes a $25 million delayed-draw tranche.

Talk on the first-lien term loan is Libor plus 350 bps to 375 bps with a 1% Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months, and talk on the second-lien term loan is Libor plus 775 bps to 800 bps with a 1% Libor floor, a discount of 99 and hard call protection of 102 in year one and 101 in year two.

Delayed-draw availability is for 12 months and subject to closing leverage, and the delayed-draw ticking fee is half the margin from days 31 to 60 from closing and the full margin thereafter.

Duravant being acquired

Proceeds from Duravant’s credit facilities will be used to help fund its buyout by Warburg Pincus from Odyssey Investment Partners., and the delayed-draw term loans will be used for targeted acquisitions.

Jefferies LLC, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC and Antares Capital are leading the debt.

Closing on the buyout is expected in the third quarter, subject to customary regulatory approvals.

Duravant is a Downers Grove, Ill.-based automation and engineered equipment company serving the food processing, packaging and material handling sectors.

Albany Molecular sets talk

Also in the primary market, Albany Molecular Research held its bank meeting on Wednesday morning and with the event price talk on its $620 million seven-year first-lien term loan (B2/B+) and $205 million eight-year second-lien term loan (Caa2/B-) was announced, according to a market source.

Talk on the first-lien term loan is Libor plus 350 bps to 375 bps with a 1% Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months, and talk on the second-lien term loan is Libor plus 750 bps to 775 bps with a 1% Libor floor, a discount of 99 and call protection of 102 in year one and 101 in year two, the source said.

The company’s $925 million of senior secured credit facilities also include a $100 million five-year revolver (B2/B+).

Commitments are due at noon ET on July 28, the source added.

Albany Molecular lead banks

Barclays, Morgan Stanley Senior Funding Inc., RBC Capital Markets, Goldman Sachs Bank USA, Jefferies LLC and Mizuho Bank Ltd. are leading Albany Molecular’s credit facilities, with Barclays the left lead on the first-lien term loan and Morgan Stanley the left lead on the second-lien term loan.

Proceeds will be used with equity to fund the buyout of the company by the Carlyle Group and GTCR LLC for $21.75 per share in cash.

Closing is subject to shareholder approval, the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and other customary conditions.

Albany Molecular is an Albany, N.Y.-based contract research and manufacturing organization that works with the life sciences industry to improve patient outcomes and the quality of life.

Culligan reveals guidance

Culligan Holding launched with its lenders’ presentation its $335 million incremental covenant-light senior secured term loan B due Dec. 13, 2023 and a repricing of its existing $298.5 million covenant-light term loan B-1 due Dec. 13, 2023 at talk of Libor plus 350 bps to 375 bps with a 1% Libor floor.

The incremental loan is talked with an original issue discount of 99.5, the repricing is offered at par and both loans are getting 101 soft call protection for six months, a market source said.

The incremental loan is at an Australian borrower and the term loan B-1 is at a U.S. borrower.

Commitments are due on July 27, the source added.

Morgan Stanley Senior Funding Inc., RBC Capital Markets LLC, BMO Capital Markets Corp. and Citigroup Global Markets Inc. are leading the deal that will be used to fund the acquisition of Zip Industries, to refinance an existing euro term loan B and to reprice an existing term loan B-1 down from Libor plus 400 bps with a 1% Libor floor.

Closing on the acquisition is expected in August.

Culligan is a Rosemont, Ill.-based provider of water treatment products and services. Zip Industries is an Australian supplier of instant drinking water appliances.

Accudyne readies deal

Accudyne Industries emerged with plans to hold a conference call at 11 a.m. ET on Thursday to launch $975 million of senior secured credit facilities, according to a market source.

The facilities consist of a $150 million revolver, a $705 million first-lien term loan and a $120 million second-lien term loan, the source said.

Morgan Stanley Senior Funding Inc., Deutsche Bank Securities Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Goldman Sachs Bank USA and RBC Capital Markets are leading the deal that will be used to refinance existing debt.

Accudyne is a Dallas-based provider of precision engineered, process-critical and technologically advanced flow control systems and industrial compressors.

Robertshaw coming soon

Robertshaw will launch to lenders on Thursday $580 million in senior secured term loans, a market source remarked.

The debt consists of a $440 million first-lien term loan B (B1/B) talked at Libor plus 450 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, and a $140 million second-lien term loan (Caa1/CCC+) talked at Libor plus 900 bps to 950 bps with a 1% Libor floor, a discount of 98 and call protection of 102 in year one and 101 in year two, the source continued.

J.P. Morgan Securities LLC is leading the deal that will be used to refinance existing debt and fund a dividend.

Robertshaw is an Itasca, Ill.-based designer and manufacturer of electro-mechanical solutions, mechanical combustion systems, and electrical controls primarily for use in residential and commercial appliances, HVAC and transportation applications.

Victory on deck

Victory Capital set a lender call for Thursday morning to launch a repricing of its term loan B from Libor plus 750 bps with a 1% Libor floor, a market source said.

RBC Capital Markets is leading the deal.

Victory Capital is a Brooklyn, Ohio-based asset management firm.

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