Tank Intermediate breaks; Graham Packaging dips on acquisition; Delta, MoneyGram tweak deals

By Sara Rosenberg

New York, April 13 - Tank Intermediate's credit facility freed up for trading on Wednesday, and Graham Packaging Co. Inc.'s term loans were a little softer after news emerged that the company is being acquired by Silgan Holding Inc.

Over in the primary, Delta Air Lines Inc. made changes to its credit facility, including raising pricing and the original issue discount, while MoneyGram International Inc. reduced pricing and the original issue discount on its oversubscribed term loan.

Also, Golden Living, Open Link Financial Inc. and Nortek Inc. released price talk on their new deals as the transactions were presented to lenders.

Furthermore, size, structure and price talk emerged on Sensus USA Inc.'s credit facility ahead of its launch, and some details on Manitowoc Co. Inc.'s upcoming deal came out as well.

Tank frees up

Tank Intermediate's credit facility hit the secondary market on Wednesday, with the $265 million term loan B quoted at par ½ bid, 101 offered, according to a market source.

Pricing on the term loan B, as well as on a $20 million revolver, is Libor plus 375 basis points with a 1.25% Libor floor, and the debt was sold at an original issue discount of 993/4. The term loan has a step-down to Libor plus 350 bps at less than 3.25 times leverage and 101 soft call protection for one year.

During syndication, pricing on the $285 million deal firmed at the midpoint of the Libor plus 350 bps to 400 bps talk and the tight end of the 1.25% to 1.5% Libor floor guidance. Also, the discount was tightened from talk of 99 to 991/2, and the pricing step-down and call protection were added to the term loan.

GE Capital Markets is the lead bank on the deal that will be used by the polyethylene and steel tanks manufacturer to refinance existing debt.

Graham term loans slide

Graham Packaging's term loan C and term loan D were both a touch weaker in trading as the company disclosed that it is being purchased by Silgan Holdings in a transaction valued at $4.1 billion, including net debt, according to a trader.

The term loan C and term loan D were both quoted at par ¾ bid, 101 offered, the trader said. By comparison, on Tuesday, the trader had the term loan C at par 7/8 bid, 101¼ offered and the term loan D at 101 bid, 101¾ offered.

Investors are expecting the debt to be repaid at par in connection with the acquisition. However, it hasn't moved down to that level just yet since guys believe the transaction will take three to six months to be completed, the trader explained.

Being that the term loan C is priced at Libor plus 425 bps with a 2.5% Libor floor and the term loan D is priced at Libor plus 425 bps with a 1.75% Libor floor, investors are still willing to pay up for the debt now, the trader added.

Graham purchase details

Under the acquisition agreement, Graham shareholders will receive 0.402 shares of Silgan common stock and $4.75 in cash per share. Included in the transaction costs is a $245 million cash payment resulting from change-in-control provisions in Graham's income tax receivable agreements with Blackstone Capital Partners III LP and the Graham family.

Silgan has received a commitment for $4 billion of debt financing to help fund the acquisition, and this debt is expected to include a new credit facility and bonds.

Pro forma for the transaction, leverage will be 3.9 times.

Closing is expected in the third quarter, subject to shareholder approval at both companies, receipt of applicable regulatory approvals and the satisfaction of customary conditions.

Silgan is a Stamford, Conn.-based manufacturer of consumer goods packaging products. Graham is a York, Pa.-based supplier of plastic containers.

Delta ups spread

Moving to the primary, Delta Air Lines flexed pricing on its $2.6 billion credit facility (Ba2/BB-/BB-) to Libor plus 425 bps from talk of Libor plus 375 bps to 400 bps, while leaving the 1.25% Libor floor unchanged, according to market sources.

The facility consists of a $1.375 billion six-year term loan B and a $1.225 billion five-year revolver.

Also under the changes, the original issue discount on the B loan was increased to 98½ from 99, sources said.

The Atlanta-based airline company's term loan B still includes 101 soft call protection for one year.

Delta repaying debt

Proceeds from Delta's credit facility will be used to refinance an old first-lien synthetic revolver/term loan, an old revolver and an old second-lien term loan.

The company's $250 million term loan that was obtained in March at pricing of Libor plus 300 bps with a 1.25% Libor floor is not being repaid with this deal. The loan had been sold at an original issue discount of 99½ and includes 101 soft call protection for one year.

J.P. Morgan Securities LLC, Bank of America Merrill Lynch, Barclays Capital Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Goldman Sachs & Co., Morgan Stanley & Co. Inc. and UBS Securities LLC are the bookrunners on the new credit facility.

MoneyGram revises pricing

MoneyGram announced modifications to its $390 million 61/2-year term loan on Wednesday that included cutting pricing to Libor plus 325 bps from Libor plus 350 bps and moving the original issue discount to 99¾ from 991/2, according to a market source.

As before, the term loan provides for a 1.25% Libor floor and 101 soft call protection for one year, the source said.

The Dallas-based payment services company's $540 million senior secured credit facility (Ba1/BB-) also includes a $150 million five-year revolver that is priced at Libor plus 325 bps with a 50 bps unused fee.

Bank of America Merrill Lynch, J.P. Morgan Securities LLC, Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and Wells Fargo Securities LLC are the lead banks on the deal.

MoneyGram funding recap

Proceeds from MoneyGram's credit facility will be used to help fiannce a recapitalization, including the repayment of roughly $140 million of outstanding bank debt and a $218 million payment inducement payment to Thomas H. Lee Partners and Goldman Sachs.

Under the recapitalization agreement, Thomas H. Lee will convert all of its series B preferreds into common stock, and Goldman Sachs will convert all of its series B-1 preferreds into shares of series D participating convertible preferred stock.

Thomas H. Lee will receive about 28.2 million additional shares of common stock and $140.8 million in cash, and Goldman Sachs will receive about 15,504 additional shares of series D preferreds and $77.5 million in cash as consideration for completing the recapitalization.

Closing is expected mid-year, subject to shareholder approval and completion of financing.

Golden Living guidance

Golden Living held a bank meeting at 1 p.m. ET to launch its proposed credit facility, and in connection with the event, price talk on the $1.5 billion term loan surfaced, according to a market source.

The term loan is being guided at Libor plus 350 bps to 375 bps with a 1.25% Libor floor and an original issue discount of 99, the source said.

The company's $1.575 billion credit facility (B1) also includes a $75 million revolver.

Citigroup Global Markets Inc. and RBC Capital Markets LLC are the lead banks on the deal that will be used to refinance existing bank borrowings and CMBS debt.

Golden Living is a Fort Smith, Ark.-based provider of post-acute health and wellness services.

Open Financial discloses talk

Open Link Financial revealed pricing guidance as the company's credit facility launched with a bank meeting at 10 a.m. ET at the Le Parker Meridien in New York, according to a market source.

The $325 million seven-year term loan B is being talked at Libor plus 400 bps with a 1.25% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, the source said.

The company's $375 million credit facility also provides for a $50 million five-year revolver.

Corporate and facility ratings are B1/B+, the source added.

Bank of America Merrill Lynch, Deutsche Bank Securities Inc. and Credit Suisse Securities (USA) LLC are the lead arrangers on the deal that will be used to refinance existing debt and fund a dividend to shareholders.

Open Link is a Uniondale, N.Y.-based provider of cross-asset trading, risk management and operations processing software services.

Nortek announces pricing

Nortek came out with talk of Libor plus 400 bps with a 1.25% Libor floor and an original issue discount of 99½ on its $350 million six-year senior secured covenant-light term loan (B1/BB-) shortly before a 2 p.m. ET bank meeting kicked off on Wednesday, according to a market source. The tranche includes 101 soft call protection for one year.

UBS Securities LLC is the lead bank on the deal and is asking for commitments by April 20.

Proceeds, along with $500 million of senior notes that priced on Tuesday at par to yield 8½%, will be used to fund a tender offer for the company's roughly $753 million 11% senior secured notes due 2013.

The tender offer expires on May 10, subject to completion of the term loan and the bonds as well as the amendment of the company's existing $300 million asset-based revolver to allow for the refinancing.

Nortek is a Providence, R.I.-based manufacturer of residential and commercial ventilation, HVAC and home technology convenience and security products.

Sensus structure surfaces

In other news, Sensus announced late Tuesday that it would be holding a bank meeting on Thursday to launch a new senior secured credit facility, and now the size, structure and price talk on that deal became available, according to sources.

The $675 million deal is comprised of a $100 million five-year revolver, a $375 million six-year first-lien term loan and a $200 million seven-year second-lien term loan, sources said.

Price talk on the first-lien term loan is Libor plus 375 basis points with a 1.25% Libor floor and an original issue discount of 99. There is no call protection.

Meanwhile, the second-lien term loan is being talked at Libor plus 750 bps with a 1.25% Libor floor and an original issue discount of 981/2, sources continued. There is call protection on this tranche of 103 in year one, 102 in year two and 101 in year three.

Sensus lead banks

Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. are the lead arrangers and bookrunners on Sensus' proposed credit facility.

In its news release on Tuesday, the company said that proceeds, along with cash on hand, would be used to fund a tender offer, which expires on May 9, for its $275 million 8 5/8% senior subordinated notes due 2013 and to refinance existing bank debt.

As more details on the deal came out, it was revealed that in addition to the refinancing, proceeds would also be used to pay a $50 million dividend and to put some working capital cash on the balance sheet.

Sensus is a Raleigh, N.C.-based technology company providing energy and water utility customers with conservation products and services.

Manitowoc size revealed

Manitowoc said in a news released on Wednesday that its proposed senior secured credit facility will be sized at $1.15 billion, comprised of a $500 million revolver and $650 million in term loan A and term loan B debt.

J.P. Morgan Securities LLC is the lead bank on the deal that is set to launch with a bank meeting on Thursday.

Proceeds will be used to refinance an existing senior secured credit facility, resulting in lower pricing and the extension of maturities of the company's revolver and term loans to 2016 and 2017 from 2013 and 2014, respectively.

Manitowoc is a Manitowoc, Wis.-based manufacturer and seller of cranes and related products and foodservice equipment.

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