Momentive rises on lender call; Vertafore dips with refi; Booz Allen, Compass move deadlines

By Sara Rosenberg

New York, Jan. 21 - Momentive Performance Materials Holdings LLC saw its U.S. term loan head higher during Friday's trading session following news of an upcoming lender call, and Vertafore Inc.'s first-lien term loan retreated with plans of a refinancing/repricing.

Over in the primary market, Booz Allen Hamilton Holding Corp. accelerated the commitment deadline on its term loan B as the deal filled out quickly, while timing on the term loan A was left unchanged, and Compass Diversified Holdings revised its B loan deadline as well.

Also, Allied Security Holdings LLC (AlliedBarton) officially launched its first- and second-lien credit facility. Prior to the conference call even taking place, however, the deal had seen a strong amount of interest from lenders.

Additionally, Houghton International Inc. upsized its term loan B while eliminating mezzanine debt, and Summit Entertainment LLC and Scitor Corp. revealed that they are getting ready to bring their new credit facilities to market.

Momentive trades up

Momentive Performance Materials' U.S. term loan was better on Friday after word emerged that the company will be holding a lender call on Monday at 11 a.m. ET, according to traders.

The term loan was quoted by one trader at par 1/8 bid, par ½ offered, up from 99½ bid, 99¾ offered, and by a second trader at 99¾ bid, par ¼ offered, up from 99¼ bid, 99¾ offered.

Details on what will be discussed on the lender call are not yet available. However, it is known that JPMorgan will be hosting the call.

One of the traders did remark that he thinks people are assuming that the company will be launching an amendment and extension proposal for its credit facility.

Momentive Performance is a Columbus, Ohio-based specialty chemicals and materials company.

Vertafore first-lien slides

Vertafore's $550 million first-lien term loan that was obtained this past summer dropped to par bid, par ¼ offered from 101 bid, 101¼ offered as investors were told that the debt would be refinanced with a new loan, according to a trader.

Pricing on the new loan is expected to be lower than pricing on the existing, which is set at Libor plus 500 basis points with a 1.75% Libor floor, and the new loan will have 101 soft call protection for one year. There is no call protection on the existing deal.

The maturity on the first-lien term loan will remain unchanged at July 2016.

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

Vertafore is a Bothell, Wash.-based provider of software and information to the insurance distribution channel.

Booz shuts B down early

Switching to the primary, Booz Allen moved the commitment deadline on its $700 million term loan B to Friday from Jan. 27, a source told Prospect News - not surprising given that the tranche was already oversubscribed before the Jan. 13 launch took place.

"B was accelerated because [it] only went to existing guys and they are all in. No changes to tranche sizes yet. Can't do that until the A deadline," the source remarked.

The books on the $350 million term loan A are still scheduled to close on Jan. 27. This tranche has been seeing good momentum since launching, but it has moving slower than the B loan simply because banks taking longer to commit to a deal than institutional investors.

Depending on demand, sources believe that there is a good chance that the term loan A will be upsized and the term loan B will be downsized being that the A loan is cheaper than the B loan. In fact, there was already a shift to more term loan A debt, as prior to the deal's launch, it was thought that the A loan would be sized at $300 million and the B loan would be sized at $750 million.

Booz Allen guidance

Price talk on Booz Allen's term loans is still in line with what was disclosed shortly before launch. The term loan A is talked at Libor plus 250 bps, and the term loan B is talked at Libor plus 300 bps to 325 bps with a 1% Libor floor and an original issue discount of 991/2. There is 101 soft call protection for one year on the B loan.

Bank of America, Credit Suisse, Barclays, Morgan Stanley, Goldman Sachs and Sumitomo are the lead banks on the deal, with Bank of America the left lead.

Proceeds from the $1.05 billion of term loans (Ba2/BBB-), along with cash on hand, will be used to refinance $1.021 billion of bank debt and $222 million of mezzanine debt.

The company expects to keep its existing revolving credit facility in place but will be amending the $250 million tranche.

Booz Allen Hamilton is a McLean, Va.-based provider of management and technology consulting services to the U.S. government in the defense, intelligence and civil markets.

Compass accelerates deadline

Also revising the commitment deadline on its term loan B was Compass Diversified, with books now scheduled to shut on the well-met deal on Monday as opposed to on Jan. 28, according to a market source.

Current price talk on the $200 million six-year last-out term loan B (B1/BB-) is Libor plus 425 bps to 475 bps with a 1.5% Libor floor and an original issue discount of 981/2. It is expected that pricing will firm up early on in the week of Jan. 24, the source said.

The $525 million senior secured credit facility also includes a $325 million five-year revolver (Ba1) talked at Libor plus 325 bps, subject to a leverage grid that kicks in six months after close, with no Libor floor and upfront fees based on commitment size.

TD Securities, BMO and SunTrust are the lead arrangers on the deal, with TD the bookrunner, and proceeds will be used to refinance existing debt and for general corporate purposes.

Compass Diversified is a Westport, Conn.-based investment firm specializing in acquiring controlling stakes in small- to middle-market companies.

Allied nabs attention

Allied Security is seeing a lot of early interest from investors toward its $660 million credit facility, with some of that attention coming even before the Friday morning conference call launch took place, according to a market source.

As was previously reported, the facility consists of a $75 million five-year revolver, a $395 million six-year first-lien term loan and a $190 million seven-year covenant-light second-lien term loan.

Price talk on the first-lien term loan is Libor plus 400 bps with a 1.5% Libor floor and an original issue discount of 99.

And price talk on the second-lien is Libor plus 750 bps with a 1.5% Libor floor and a discount of 99. There is call protection of 103 in year one, 102 in year two and 101 in year three on this tranche.

Credit Suisse and Bank of America are the lead banks on the deal that will be used by the Conshohocken, Pa.-based security services company to refinance existing bank and mezzanine debt.

Houghton tweaks deal

Houghton International upsized its term loan B to $450 million from $315 million as mezzanine debt was eliminated from the capital structure, and the original issue discount was moved to 99½ from 981/2, according to a market source.

Pricing on the term loan was remained at Libor plus 500 bps with a 1.75% Libor floor, and there is still 101 soft call protection for one year.

The company's now $500 million senior secured credit facility, up from $365 million, also includes a $50 million revolver priced at Libor plus 500 bps with a 1.75% Libor floor.

Deutsche Bank, Bank of Ireland and GE Capital are the joint lead arrangers on the deal, with Deutsche the left lead.

Houghton funding acquisition

Proceeds from Houghton's credit facility will be used to fund the acquisition of Royal Dutch Shell plc's Metalworking and Metal Rolling Oils business, a specialty fluid manufacturer in the metal working and metal rolling fluids marketplace, and to refinance existing senior secured debt.

The transaction is anticipated to close early this year, subject to regulatory approval.

Leverage at close will be 4.3 times all senior. Before the changes, leverage was 3.1 times senior and 4.3 times total.

Also, prior to the changes, ratings on the credit facility were B1/B+.

Houghton is a Valley Forge, Pa.-based developer and producer of specialty chemicals, oils and lubricants for the metalworking, automotive, steel and aluminum industries.

Summit launching soon

Summit Entertainment's proposed $800 million senior secured credit facility (B1/B) is expected to launch with a bank meeting during the week of Jan. 24, according to a market source.

The facility consists of a $200 million five-year revolver and a $600 million seven-year term loan.

JPMorgan and UBS are the lead banks on the deal that will be used to repay existing debt, for working capital needs and general corporate purposes and to fund a dividend.

Summit Entertainment is a Santa Monica, Calif.-based independent film studio.

Scitor readies deal

Scitor has set a bank meeting for Tuesday to launch a proposed $305 million credit facility, comprised of a $30 million revolver and a $275 million term loan, according to a market source.

JPMorgan is the lead bank on the deal that will be used for a recapitalization.

Scitor is a provider of systems engineering, financial and management consulting, information services, and other services for corporate customers and government programs.

Realogy seeing resistance

In some follow-up news, rumor is that Realogy Corp.'s credit facility amendment and extension proposal may be seeing some pushback from investors, with guys possibly looking for more spread, according to source.

On Jan. 18, the company launched the proposal, asking to extend its revolver by three years to April 10, 2016 and its first-lien term loan and synthetic letter of credit facility by three years to Oct. 10, 2016.

Pricing on the extended revolver is being offered at Libor plus 325 bps, up from non-extended pricing of Libor plus 225 bps, and pricing on the extended term loan and letter of credit facility is being offered at Libor plus 425 bps, up from Libor plus 300 bps on the non-extended.

In addition, the amendment would provide the company with additional flexibility to get secured debt and additional junior-lien debt. The secured debt would be used to refinance existing secured and unsecured debt.

Realogy paying down debt

As a condition to the amendment, Realogy must undertake a new $700 million secured debt financing that will be used to prepay a portion of the extended term loans.

To this end, the company announced on Friday that it is selling $700 million of senior secured notes due 2019.

JPMorgan is the lead bank on the amendment and extension.

Lenders are being offered a 10 bps amendment fee and responses are due on Jan. 25.

Realogy is a Parsippany, N.J.-based provider of real estate and relocation services.

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