Delta, MoneyGram, Ranpak break; Golden Nugget, Sourcecorp rework deals; Potters sets talk

By Sara Rosenberg

New York, April 15 - Delta Air Lines Inc.'s credit facility hit the secondary market on Friday, with levels on the term loan B seen above its original issue discount price, and MoneyGram International Inc. and Ranpak Corp. freed up as well.

Over in the primary market, Landry's Golden Nugget Atlantic City downsized and revised the structure of its credit facility while coming out with official price talk, and Sourcecorp Inc. flexed pricing higher on its first-lien term loan.

Additionally, Potters Industries Inc. released price talk on its first- and second-lien credit facility in connection with the deal's launch during the session, and Iasis Healthcare LLC emerged with plans to being a new deal to market.

Delta frees up

Delta's credit facility began trading on Friday, with the $1.375 billion six-year term loan B quoted at 98¾ bid, 99¼ offered and then it moved up to 98 7/8 bid, 99 3/8 offered, according to traders.

Pricing on the term loan B and on a $1.225 billion five-year revolver is Libor plus 425 basis points, after flexing from talk of Libor plus 375 bps to 400 bps, with a 1.25% Libor floor. The B loan was sold at a discount of 981/2, widened from talk of 99, and includes 101 soft call protection for one year.

Proceeds from the $2.6 billion credit facility (Ba2/BB-/BB-) will be used by the Atlanta-based airline company to refinance an old first-lien synthetic revolver/term loan, an old revolver and an old second-lien term loan.

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 deal.

MoneyGram starts trading

MoneyGram, a Dallas-based payment services company, also saw its credit facility break for trading, with the $390 million six-year term loan quoted at par ¼ bid, par ¾ offered on the open and then it moved up to par ½ bid, 101 offered, according to a trader.

Pricing on the term loan is Libor plus 325 bps with a 1.25% Libor floor, and it was sold at an original issue discount of 993/4. There is 101 soft call protection for one year.

During syndication, pricing on the term loan was reduced from Libor plus 350 bps, and the discount tightened from 99½ as the deal was met with strong investor demand.

The 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 recapitalizing

Proceeds from MoneyGram's credit facility will be used to help fund 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 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.

Ranpak tops par

Another deal to make its way into the secondary market was Ranpak, with its $200 million six-year term loan quoted at par ¼ bid, par ¾ offered on the break and then it moved up to par 3/8 bid, par 7/8 offered, according to a market source.

Pricing on the term loan is Libor plus 350 bps, after flexing down from initial talk of Libor plus 375 bps to 400 bps. There is a 1.25% Libor floor and 101 soft call protection for one year, and it was sold at a discount of 991/2.

The company's roughly $290 million facility also provides for a $20 million five-year revolver and a €50 million six-year term loan priced at Euribor plus 400 bps, after firming at the tight end of the Euribor plus 400 bps to 425 bps talk, with a 1.25% Libor floor. The euro term loan was also sold at a discount of 99½ and has 101 soft call protection for one year.

Ranpak getting second-lien

In addition to the first-lien credit facility, Ranpak is getting a $175 million second-lien term loan that had already been placed prior to syndication of the first-lien debt.

Goldman Sachs & Co. and Bank of America Merrill Lynch are the lead banks on the deal.

Proceeds will be used to refinance existing debt.

Ranpak is a Concord Township, Ohio-based manufacturer of in-the-box paper protective packaging systems and materials.

Golden Nugget tweaks deal

Moving to the primary, Landry's Golden Nugget trimmed its five-year senior secured credit facility to $95 million from $110 million and set price talk after spending the last few weeks educating accounts about the story, according to a market source.

Under the new structure, the facility consists of a $10 million first-out first-lien revolver and an $85 million last-out first-lien term loan, the source said. By comparison, at launch the deal was structured as a $10 million revolver (B1/BB-) and a $100 million term loan (Caa1/B+).

Price talk on the revolver and the term loan is Libor plus 950 bps with a 1.5% Libor floor and an original issue discount of 96, the source continued. The term loan is non-callable until Jan. 1, 2013, then at 103 for one year and at 101½ for the following year.

The deal was originally launched with a bank meeting on March 31, but price talk hadn't been disclosed until now.

Golden Nugget getting equity

Proceeds from Landry's Golden Nugget's credit facility will be used to fund the purchase, renovation and rebranding of the Trump Marina Hotel and Casino in Atlantic City by Tilman J. Fertitta, chairman, president, chief executive officer and owner of Landry's Inc., a full-service restaurant, hospitality and entertainment company.

As part of the changes to the financing structure, Fertitta has now agreed to put in $45 million of equity, and there is also a $15 million completion guarantee and interest keepwell from Landry's Restaurants, if needed.

Jefferies & Co. is the lead bank on the credit facility.

Sourcecorp lifts pricing

Also coming out with changes Friday was Sourcecorp, as it raised pricing on its $350 million seven-year first-lien term loan (B1) to Libor plus 500 bps from Libor plus 425 bps, while leaving the 1.25% Libor floor and original issue discount of 99½ intact, according to a market source.

The company's $625 million credit facility also provides for a $75 million revolver (B1) and a $200 million eight-year second-lien term loan (Caa2).

The second-lien loan continues to be talked at Libor plus 800 bps with a 1.25% floor and an original issue discount of 99. Call protection on the tranche is 102 in year one and 101 in year two.

Commitments on the credit facility are still due on Thursday.

Sourcecorp funding merger

Proceeds from Sourcecorp's credit facility will be used to help finance its merger with HOV Services Inc., after which shareholders of Sourcecorp and HOV will each control and receive 50% ownership of the combined company.

Closing is subject to customary conditions, including expiration of the antitrust waiting period.

UBS Securities LLC, Credit Suisse Securities (USA) LLC and Jefferies & Co. are the lead banks on the credit facility.

Sourcecorp, a portfolio company of Apollo Management, is a Dallas-based provider of business process outsourcing and consulting services. HOV is a Troy, Mich.-based end-to-end business process outsourcing company.

Global Defense upsizes

Global Defense Technology & Systems Inc. lifted its six-year term loan B to $145 million from $132.5 million and added 101 soft call protection for one year, according to a market source, who said that pricing remained at Libor plus 550 bps with a 1.5% Libor floor and an original issue discount of 99.

Pricing on the B loan had been increased earlier from Libor plus 500 bps after ratings came out lower than expected at B3/B.

The company's now $170 million credit facility (B3/B), up from $157.5 million, also includes a $25 million five-year revolver priced at Libor plus 500 bps with no Libor floor.

Allocations are expected to go out in the middle of the week of April 18.

Wells Fargo Securities LLC and SunTrust Robinson Humphrey Inc. are the lead banks on the deal.

Global Defense backing buyout

Proceeds from Global Defense's credit facility are being used to back its acquisition by Ares Management LLC in a transaction valued at about $315 million, including the assumption of debt and prior to expenses.

The transaction has already been completed with the sponsor using equity to fund the deal. Funds from the credit facility will be used to repay some of that equity, and the amount of that paydown has grown as a result of the term loan upsizing.

With the completion of the acquisition, the company became wholly owned by Sentinel Acquisition Holdings Inc., an affiliate of Ares.

Global Defense Technology is a McLean, Va.-based provider of mission-critical, technology-based systems and services for national security agencies and programs of the U.S. government.

Potters talk emerges

In more primary happenings, Potters Industries held a call on Friday to kick off syndication on its proposed $302.5 million credit facility, and with the launch, price talk was announced, according to a market source.

Both the $40 million five-year revolver (Ba3/B) and the $150 million six-year first-lien term loan (Ba3/B) are being talked at Libor plus 475 bps, with the revolver having a 50 bps unused fee, and the $112.5 million 61/2-year second-lien term loan (Caa1/CCC+) is being talked at Libor plus 875 bps, the source said.

The first-lien term loan has a 1.5% Libor floor and 101 soft call protection for one year, and the second-lien term loan has a 1.75% Libor floor and call protection of 104 in year one, 103 in year two, 102 in year three and 101 in year four.

Also, the revolver is being offered at a discount of 99, the first-lien term loan is being offered at 98½ and the second-lien term loan is being offered at 98, the source remarked.

Potters being spun off

Proceeds from Potters Industries' credit facility will be used to pay down borrowings under PQ Corp.'s credit facility in connection with its spin-off from PQ.

The transaction is expected to close in early May, and following completion of the spin-off, Potters and PQ will operate as separately managed companies held by common owners the Carlyle Group, Ineos Group and PQ management.

J.P. Morgan Securities LLC is the lead bank on the credit facility.

Potters is a Malvern, Pa.-based producer of engineered glass materials for the highway safety, polymer additive, metal finishing and other specialty end markets. PQ is a Malvern, Pa.-based producer of specialty chemicals and catalysts.

Iasis sets launch

Iasis Healthcare has scheduled a bank meeting for 10 a.m. ET on Tuesday to launch a proposed $1.235 billion credit facility that will be used, along with bonds, to refinance existing debt and to fund a $230 million dividend, according to a market source.

The facility consists of a $300 million revolver, a $775 million term loan B and a $160 million delayed-draw term loan, the source said, adding that price talk is not yet available.

Bank of America Merrill Lynch, Barclays Capital Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. and J.P. Morgan Securities LLC are the lead banks on the deal.

Iasis Healthcare is a Franklin, Tenn.-based owner and operator of medium-sized acute care hospitals.

UniTek closes

UniTek Global Services Inc. completed its $175 million credit facility that consists of a $100 million term loan (B3/B) due 2018 and a $75 million ABL revolver (Ba2/BB) due 2016, according to a news release.

Pricing on the term loan is Libor plus 750 bps with a 1.5% Libor floor, and it was sold at a discount of 97. There is soft call protection of 102 in year one and 101 in year two. Pricing on the revolver is Libor plus 250 bps with a 37.5 bps unused fee.

During syndication, the term loan was upsized from $85 million, the spread was increased from Libor plus 725 bps, the discount was widened from 98½ and call protection was added. Also, pricing on the revolver was reduced from Libor plus 300 bps and the unused fee was tightened from 62.5 bps.

FBR Capital Markets acted as the lead on the deal that was used to refinance existing debt.

UniTek is a Blue Bell, Pa.-based provider of engineering, construction management and installation fulfillment services to the telecommunications, broadband cable and satellite industries.

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