Getty breaks; Neiman rises; Hanesbrands dips; Dunkin' talk emerges; MedAssets ups deadline

By Sara Rosenberg

New York, Nov. 4 - Getty Images Inc.'s credit facility allocated and freed up for trading during Thursday's market hours, with the term loan B quoted well above its original issue discount price.

Also in trading, Neiman Marcus Inc. headed higher as the company announced plans for an amendment and extension, Hanesbrands Inc. softened with paydown news, and First Data Corp., Education Management Corp. and NRG Energy Inc. all strengthened with earnings.

"A lot of good earnings," one trader remarked. "But, the outperformance is mitigated by the general risk bid for most paper. A lot of stuff in consumer/retail space is up a half to three-quarters."

Over in the primary market, Dunkin' Brands Inc. released price talk on its credit facility as the deal was presented to lenders, and MedAssets Inc. accelerated the commitment deadline on its oversubscribed term loan.

And, in other loan happenings, Community Health Systems Inc. revised its amendment and extension proposal, offering lenders higher pricing on the extended debt.

Getty starts trading

Getty Images' credit facility hit the secondary market on Thursday, with the $1.27 billion six-year term loan B opening up at par bid, 101 offered, according to sources.

The B loan then headed up to 101 bid, 101½ offered, came back in a little to par ¾ bid, 101¼ offered and then found its way back to 101 bid, 101¼ offered, sources said.

Pricing on the term loan is Libor plus 375 basis points with a 1.5% Libor floor, and it was sold at an original issue discount of 99. There is 101 soft call protection for one year.

During syndication, pricing on the term loan B was reduced from Libor plus 425 bps and call protection was added.

Getty getting revolver

Getty Images' $1.37 billion senior secured credit facility (Ba3/BB-) also provides for a $100 million revolver.

Barclays, JPMorgan, GE Capital, Bank of America and Goldman Sachs are the lead banks on the deal.

Proceeds will be used to refinance existing debt and fund a dividend payment.

Getty Images is a Seattle-based creator, aggregator and distributor of visual and multimedia content to creative and communication professionals.

Neiman up with amend/extend

Neiman Marcus' term loan was better on Thursday as the company launched an amendment and extension proposal to lenders in the afternoon, according to traders.

The term loan was quoted by one trader at 98¾ bid, 99¼ offered, up from 98 1/8 bid, 98 3/8 offered, by a second trader at 99 bid, 99¼ offered, up about a point on the day, and by a third trader at 98 7/8 bid, 99 3/8 offered, up from 98 bid, 98¼ offered.

Under the proposal, the company is looking to extend the maturity on some or all of its term loan by three years from April 6, 2013, and pricing on the extended debt will be Libor plus 325 bps. At July 31, there was roughly $1.5 billion of the term loan outstanding and pricing was Libor plus 200 bps.

The amendment would also allow the company to get additional debt to refinance the non-extended term loan.

Credit Suisse and JPMorgan are the lead banks on the deal, and they are offering lenders a 10 bps amendment fee.

Neiman releases numbers

In more Neiman news, the company came out with preliminary company-wide revenues for October on Thursday.

Total revenues and comparable revenues for the month are both expected to be $306 million, up 11.5% from $274 million last year.

In the four-week October period, comparable revenues in the specialty retail stores segment, which includes Neiman Marcus Stores and Bergdorf Goodman, increased 9.5%.

And, comparable revenues at Neiman Marcus Direct in October increased 21.4%.

Neiman is a Dallas-based high-end specialty retailer.

Hanesbrands slides

Hanesbrands' term loan weakened after the company revealed plans for a repayment since the debt was previously trading well above paydown levels, according to traders.

The term loan was quoted by one trader at 99 7/8 bid, par 3/8 offered, down from par 7/8 bid, 101 3/8 offered, and by a second trader at par 1/8 bid, par 7/8 offered, down from 101 bid, 101½ offered.

On Thursday morning, the company said in a news release that it plans on repaying a portion of the borrowings outstanding under its senior secured credit facility using proceeds from a $750 million senior notes offering.

Then, late in the day, the bond offering was upsized to $1 billion.

Hanesbrands is a Winston-Salem, N.C.-based marketer of everyday basic apparel.

First Data gains

First Data, a Greenwood Village, Colo.-based provider of electronic commerce and payment services, saw its term loans move noticeably higher in trading, helped along by earnings and the overall positive tone in the market, according to traders.

The term loan B-1, B-2 and B-3 were quoted by one trader at 91½ bid, 92 offered, up from 90 7/8 bid, 91 1/8 offered, and by a second trader at 92 bid, 92 3/8 offered, up from 90 5/8 bid, 91 offered.

For the third quarter, First Data had a net loss of $431 million, compared to a net loss of $291 million last year. The loss included a charge of $178 million associated with U.S. tax legislation signed in August that adversely affects the company's ability to use foreign tax credits to offset future U.S. taxes.

Revenues for the quarter were $2.6 billion, up 8% from $2.4 billion in the prior year.

And, adjusted EBITDA for the quarter was $526 million, compared to $525 million in the third quarter of 2009.

Education Management rises

Education Management's term loan headed higher on the back of the release of quarterly results that showed a year-over-year improvement in earnings, revenues and adjusted EBITDA, according to traders.

The term loan was quoted by one trader at 95¾ bid, 9 ¾ offered, up from 93 3/8 bid, 93 7/8 offered, and by a second trader at 95¾ bid, 96¼ offered, up from 93½ bid, 94 offered.

For the fiscal 2011 first quarter, the company reported net income of $36.4 million, or $0.25 per diluted share, compared to net income of $15.8 million, or $0.13 per diluted share, for the same period a year ago.

Net revenues for the quarter were $666 million, up 24.6% from $534.4 million in the comparable period last year.

And, EBITDA for the quarter was increased 34.4% to $121.7 million from $90.6 million in the fiscal 2010 first quarter.

Education sets guidance

For the second quarter of fiscal 2011, Education Management expects net income to be between $85 million and $88 million, diluted earnings per share to be between $0.60 and $0.62, and EBITDA to be between $203 million and $209.

For the 12 months ending Dec. 31, net income is expected to be between $254 million and $257 million and diluted earnings per share is expected to be between $1.77 and $1.80.

And, excluding the expenses incurred in the third quarter of fiscal 2010 related to the debt repurchase, corporate restructuring and reversal of an uncertain tax position liability, net income for the year is expected to be in the range of $241 million to $244 million, earnings per diluted share is expected to be in the range of $1.68 to $1.71 and EBITDA is expected to be in the range of $643 million to $649 million.

Education Management is a Pittsburgh-based provider of post-secondary education

NRG better with numbers

NRG's non-extended bank debt gained some ground in trading despite the release of not-so-great third-quarter results, as full-year estimates were increased, according to traders.

The non-extended debt was quoted by one trader at 98¾ bid, 99¼ offered, up from 98¼ bid, 98¾ offered, and by a second trader at 99 bid, 99½ offered, up from 98¾ bid, 99¼ offered.

Meanwhile the extended debt was seen as higher by the first trader at par 1/8 bid, par 5/8 offered, up from par bid, par ½ offered, and unchanged by the second trader at par bid, par ½ offered.

For the third quarter, NRG reported net income of $223 million, or $0.87 per diluted common share, compared to $278 million, or $1.02 per diluted common share, last year.

Total operating revenues for the quarter were $2.7 billion, compared to $2.9 billion in the prior year.

And, adjusted EBITDA for the quarter was $777 million versus $906 million for the third quarter of 2009.

NRG revises outlook

In connection with announcing earnings, NRG revised its full-year 2010 adjusted EBITDA guidance to a range of $2.5 billion to $2.55 billion from prior estimates of $2.45 billion to $2.55 billion as a result of continued strong results in the third quarter.

And, estimates for free cash flow before growth investments were revised to roughly $1.2 to $1.25 million, representing an increase of $57 to $107 million over the range of prior guidance.

As for 2011, the company expects adjusted EBITDA in the range of $1.9 billion to $2.1 billion and free cash flow before growth investments in the range of $950 million to $1.15 billion.

NRG is a Princeton, N.J.-based owner and operator of diverse power generation portfolios.

Dunkin' Brands sets talk

Moving to the primary, Dunkin' Brands held a bank meeting at noon ET on Thursday to launch its proposed $1.35 billion senior credit facility, and in connection with the event, price talk was disclosed, according to a market source.

Both the $100 million five-year revolver and the $1.25 billion seven-year term loan B are being talked at Libor plus 425 bps with a 1.5% Libor floor, the source said.

In addition, the term loan B is being offered at an original issue discount of 99 and includes 101 soft call protection for one year.

Barclays, JPMorgan, Bank of America and Goldman Sachs are the joint lead arrangers and joint bookrunners on the deal, with Barclays the left lead.

Dunkin' funding dividend

Proceeds from Dunkin' Brands' credit facility, along with $625 million of senior notes, will be used to repay in full its outstanding securitization debt and to pay a cash dividend to stockholders.

The deal has already seen some early interest from lenders, and Thursday's bank meeting saw strong attendance, the source remarked.

Senior leverage is 4.2 times and total leverage is 6.5 times.

Mid single-B corporate ratings are expected for the company, the source added.

Canton, Mass.-based Dunkin' Brands is the parent company of Dunkin' Donuts, a coffee and baked goods restaurant chain, and Baskin-Robbins, an ice cream specialty store chain.

Lineage Power pricing

Pricing on Lineage Power's $135 million term loan is 10%, versus initial talk that was floating around in the 9½% to 10% range, according to a market source.

The deal was working towards shutting its books on Thursday.

Wells Fargo is the lead bank on the deal that will be used to refinance existing debt.

Lineage is a Plano, Texas-based producer of hardware and software for power conversion.

MedAssets accelerates timing

MedAssets moved up the commitment deadline on its $600 million six-year term loan B to Monday at noon ET as a result of strong demand, according to a market source.

Price talk on the term loan B is Libor plus 400 bps to 425 bps with a 1.5% Libor floor and an original issue discount of 99. There is 101 soft call protection for one year.

The company's $750 million credit facility (Ba3/BB-) also includes a $150 million five-year revolver talked at Libor plus 400 bps to 425 bps with a 1.5% Libor floor as well.

Barclays and JPMorgan are the joint lead arrangers on the deal, with Barclays the left lead and administrative agent. Bank of America, Raymond James and Fifth Third Bank all signed on as documentation agents prior to the bank meeting.

MedAssets buying Broadlane

Proceeds from MedAssets' credit facility, along with $360 million of senior unsecured notes, will be used to fund the acquisition of the Broadlane Group and to refinance existing bank debt.

Under the acquisition agreement, MedAssets is buying Broadlane, a Dallas-based end-to-end cost-management partner for health care providers, for roughly $850 million in cash, with $725 million to be paid at closing and $125 million to be paid in January 2012.

The total funded debt will be 5.2 times trailing pro forma adjusted EBITDA, taking into consideration the company's estimate for cost-based synergies.

MedAssets is an Alpharetta, Ga.-based provider of technology enabled products and services for hospitals, health systems and ancillary health care providers.

Community Health tweaks

In other news, Community Health Systems is now offering lenders pricing of Libor plus 350 bps on its extended term loan as opposed to pricing of Libor plus 325 bps, according to a market source. Pricing on the non-extended debt is Libor plus 225 bps.

Also, while the amendment would still permit the incurrence of senior secured debt if a 3.5 times first-lien test is met, proceeds from that debt would now be restricted to acquisitions or to repay secured debt, the source said.

As was previously reported, the company is looking to push out the maturity on $1.5 billion of its term loan debt to January 2017 from July 2014. The loan would have a springing maturity to April 2015 if the company's senior notes are not refinanced by that date.

Community Health bid up

Following the changes to the amendment and extension proposal, Community Health's existing term loan was bid higher, according to a trader.

Specifically, the term loan was quoted at 98¾ bid, 99 offered versus previous levels of 98 5/8 bid, 99 offered, the trader said.

Credit Suisse is the lead bank on the amendment and extension.

Lenders are being offered a 10 bps amendment fee.

Community Health is a Nashville, Tenn.-based hospital company.

Deltek closes

Deltek Inc. closed on its $230 million secured credit facility (B1/BB) comprised of a $30 million five-year revolver and a $200 million six-year term loan, according to a news release.

Pricing on the revolver and term loan is Libor plus 400 bps with a 1.5% Libor floor, and the term loan was sold at an original issue discount of 99. The revolver has a 75 bps unused fee.

During syndication, the term loan was upsized from $190 million, pricing was reverse flexed from Libor plus 425 bps, the floor was reduced from 1.75% and the discount tightened from 981/2.

Credit Suisse acted as the lead bank on the deal that was used to refinance an existing credit facility and is available for general corporate purposes.

Deltek is a Herndon, Va.-based provider of enterprise applications software designed specifically for project-focused businesses and professional services firms.

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