Chrysler dips with sales results; Jazz Pharma, Mitel, CBS Outdoor, Viskase set launches

By Sara Rosenberg

New York, Jan. 3 - Chrysler Group LLC's term loan was a little lower in trading on Friday as the company released monthly and full-year sales numbers that fell short of expectations.

Switching to the primary, Jazz Pharmaceuticals Inc. disclosed the timing and structure on its incremental bank debt, Mitel Networks Corp. set its bank meeting date, and CBS Outdoor Americas Inc. and Viskase Cos. Inc. joined the near-term calendar.

Chrysler softens

Chrysler's term loan weakened a bit in the secondary market on Friday after sales results for December and all of 2013 were announced, according to a trader.

The term loan was quoted at par 5/8 bid, 101 1/8 offered, down from par ¾ bid, 101¼ offered, the trader said, explaining that although the sales numbers showed year-over-year improvements, they were below expectations.

For December, Chrysler reported total U.S. sales of 161,007 units, up 6% from 152,367 units in December 2012. Total car sales for the month were 37,749, down from 45,289, while total truck sales were 123,258, up from 107,078.

For full year 2013, the company had total sales of 1,800,368, up 9% from 1,651,787 for full year 2012. Car sales for the year were 551,104, an increase from 498,095, and truck sales were 1,249,264, versus 1,153,692 in the previous year.

Chrysler spending cash

The trader said that another contributing factor to Chrysler's term loan dip is that "cash went out the door" as part of the recent agreement reached with the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America.

Under the memorandum of understanding reached between the parties, Chrysler will provide additional contributions to the VEBA Trust of an aggregate of $700 million in four equal annual installments.

The initial $175 million payment will be made on closing of a transaction in which the VEBA Trust will sell to Fiat North America all of the VEBA Trust's equity interest in Chrysler, and additional payments of $175 million will be payable on each of the next three anniversaries of the initial payment.

Chrysler, an Auburn Hills, Mich.-based automotive company, expects to fund the initial contribution to the VEBA Trust from available cash on hand.

Jazz timing emerges

Over in the primary, Jazz Pharmaceuticals disclosed that it will be getting $575 million in incremental bank debt and that a bank meeting for the transaction will take place at 10 a.m. ET on Tuesday, a market source said.

The debt is comprised of a $175 million incremental revolver and a $400 million incremental term loan, with price talk not yet available, the source said.

By comparison, in recent filings with the Securities and Exchange Commission, the company said it would be getting a $500 million incremental senior secured term loan due June 12, 2018 priced at Libor plus 275 basis points with a 0.75% Libor floor.

Barclays is leading the deal that will be used with revolver borrowings and cash on hand to fund the acquisition of Gentium SpA for $57.00 per share, or about $1 billion.

Closing is expected this quarter, subject to at least 66.67% of the fully diluted number of ordinary shares and ADS of Gentium being tendered in the offer, and customary conditions.

Jazz is a Dublin, Ireland-based specialty biopharmaceutical. Gentium is a Como, Italy-based biopharmaceutical company.

Mitel sets launch

Mitel Networks scheduled a bank meeting for Tuesday to launch its previously announced $405 million senior secured credit facility, according to a market source.

Filings with the Securities and Exchange Commission have outlined the deal as a $355 million six-year term loan and a $50 million five-year revolver, both priced at Libor plus 500 bps.

The filings also said that the term loan would have a 1% Libor floor and 101 soft call protection for six months, and the revolver would have a 50 bps unused fee.

Official price talk on the transaction, however, is not yet available.

Jefferies Finance LLC and TD Securities (USA) LLC are leading the deal that will be used to help fund the acquisition of Aastra Technologies Ltd. for $6.52 in cash plus 3.6 Mitel common shares per Aastra common share and to refinance an existing credit facility.

Closing is targeted for this quarter, subject to Aastra shareholder approval, court approval, compliance with the Investment Canada Act and other customary conditions.

Mitel is a Kanata, Ont.-based provider of cloud and premises-based unified communications software products. Aastra is a Concord, Ont.-based enterprise communications company.

CBS Outdoor on deck

CBS Outdoor set a bank meeting for 10 a.m. ET on Tuesday to launch a new credit facility, according to a market source, who said size and structure are not yet available.

In a recent S-11/A filing with the Securities and Exchange Commission, the company revealed that it expects to get about $1.6 billion through a new senior secured term loan and senior notes, and, in addition to that, it will get a new revolver that will be undrawn at close.

Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and Wells Fargo Securities LLC are leading the deal, which is being done in connection with the company's initial public offering of common stock.

Proceeds will be used to make a payment to current parent company CBS Corp. for the contribution of the entities comprising the Outdoor Americas operating segment, and for general corporate purposes.

CBS Outdoor is a New York-based lessor of advertising space on out-of-home advertising structures and sites.

Viskase coming soon

Viskase emerged with plans to host a bank meeting at 2:30 p.m. ET in New York on Thursday to launch a $275 million seven-year term loan B that is talked with a 1% Libor floor and 101 soft call protection, according to a market source.

UBS Securities LLC is leading the deal.

Proceeds will be used to refinance existing debt.

Viskase is a Darien, Ill.-based producer and seller of cellulosic, fibrous and plastic casings for the processed meat and poultry industry.

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