Cengage breaks; Cloud Software, Kestra changes emerge; Quikrete, EPIC, Aramark set talk

By Sara Rosenberg

New York, March 18 – Cengage Learning Inc.’s first-lien term loan B made its way into the secondary market on Monday with levels quoted above its original issue discount.

In more happenings, Cloud Software Group Inc. (Picard Parent Inc.) modified the original issue discount on its first-lien term loan B, and Kestra Advisor Services Holdings A Inc. increased the size of its first-lien term loan, trimmed the spread and firmed the original issue discount at the tight end of guidance.

Also, Quikrete Holdings Inc., EPIC Y-Grade Services LP, Aramark Services Inc., RelaDyne Inc. and Hillman Group Inc. released price talk with launch.

Furthermore, Swissport, NorthRiver Midstream, Crystal Clean (JFL-Tiger Acquisition Co. Inc.) and Ultra Clean Holdings Inc. joined this week’s new issue calendar.

Cengage hits secondary

Cengage’s $1.645 billion senior secured covenant-lite first-lien term loan B due March 2031 (B2/B) broke for trading on Monday, with levels quoted at 99½ bid, par offered on the open and then levels moved up to 99¾ bid, par ¼ offered, a trader said.

Pricing on the term loan is SOFR plus 425 basis points with a 1% floor, and it was sold at an original issue discount of 99. The debt has 101 soft call protection for six months.

During syndication, the term loan was upsized from $1.613 billion, pricing was reduced from talk in the range of SOFR plus 450 bps to 475 bps, and a number of revisions were made to documentation.

Morgan Stanley Senior Funding Inc., BMO Capital Markets, Wells Fargo Securities LLC, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs Bank USA, Standard Chartered, UBS Investment Bank, Apollo and KKR Capital Markets are leading the deal that will be used to refinance the company’s existing $1.613 billion term loan B and, due to the recent upsizing, to pay related fees and expenses.

Closing is expected early in the week of March 25.

Cengage is a Boston-based educational content, technology and services company.

Cloud tightened

Moving to the primary market, Cloud Software Group changed the original issue discount on its $1 billion seven-year first-lien term loan B (B2/B) to 99 from 98.5, according to a market source.

Pricing on the term loan remained at SOFR plus 450 bps with a 0.5% floor, and the debt still has 101 soft call protection for six months.

Recommitments were due at 3:30 p.m. ET on Monday, the source added.

BofA Securities Inc., Goldman Sachs Bank USA, UBS Investment Bank and others are leading the deal that will be used to partially repay preferred equity.

Cloud Software, formed in 2022 through the combination of Citrix Systems Inc. and Tibco Software Inc., is a provider of software franchises for and across data, automation, insight and collaboration serving enterprises across private, public, managed and sovereign cloud environments.

Kestra reworked

Kestra Advisor Services raised its seven-year first-lien term loan to $840 million from $825 million, lowered pricing to SOFR plus 400 bps from SOFR plus 425 bps, and set the original issue discount at 99.5, the tight end of the 99 to 99.5 talk, a market source remarked.

As before, the term loan has a 0% floor and 101 soft call protection for six months.

The company’s now $937.5 million of credit facilities also include a $97.5 million five-year revolver.

Recommitments were due at 5 p.m. ET on Monday, the source added.

UBS Investment Bank is the left lead on the deal that will be used to refinance the company’s existing first-lien credit facilities and, due to the upsizing, for general corporate purposes including future mergers and acquisitions.

Kestra, a Warburg Pincus LLC portfolio company, is an Austin, Tex.-based wealth management platform supporting a broad range of independent financial advisers.

Quikrete holds call

Quikrete emerged in the morning with plans to hold a lender call at 1 p.m. ET on Monday to launch $4.07 billion of term loans (BB), according to a market source.

The debt is split between a $1.67 billion covenant-lite term loan B due March 18, 2029 talked at SOFR plus 225 bps with a 0% floor and a par issue price, and a $2.4 billion seven-year covenant-lite term loan B talked at SOFR plus 250 bps with a 0% floor and an original issue discount of 99.5 to 99.75, the source said. Both loans have 101 soft call protection for six months.

Commitments are due at noon ET on Friday, the source added.

Wells Fargo Securities LLC is the left lead on the deal that will be used to reprice an existing term loan B due 2029 down from SOFR plus 275 bps and to refinance an existing term loan B due 2027.

Quikrete is an Atlanta-based manufacturer of infrastructure and industrial construction, repair and home improvement products.

EPIC shops loan

EPIC Y-Grade Services held a lender call at 2 p.m. ET, launching a $1.075 billion senior secured term loan B due June 30, 2029 (B3/B-) at talk of SOFR plus 550 bps to 575 bps with a 0% floor, an original issue discount of 97.5 to 98 and 101 soft call protection for six months, a market source remarked.

Commitments are due at noon ET on March 28, the source added.

Barclays, Wells Fargo Securities LLC, UBS Investment Bank, TCS and MUFG are leading the deal that will be used to refinance existing debt, repay the EPIC propane loan, and pay related fees and expenses.

Ares Management Corp. is the sponsor.

EPIC Y-Grade is a transporter of natural gas liquids.

Aramark repricing

Aramark launched in the morning without a lender call a $730 million covenant-lite term loan B-7 due April 6, 2028 and a $1.095 billion covenant-lite term loan B-8 due June 22, 2030, both talked at SOFR plus 200 bps to 225 bps with no CSA, a 0% floor, a par issue price and 101 soft call protection, a market source said.

Commitments are due at noon ET on Friday, the source added.

Wells Fargo Securities LLC is the left lead on the deal that will be used to reprice an existing term loan B-5 due April 6, 2028 and an existing term loan B-6 due June 22, 2030 down from SOFR+CSA plus 250 bps with a 0% floor. Current CSA is 11.448 bps one-month rate, 26.161 bps three-month rate and 42.826 bps six-month rate.

Aramark is a Philadelphia-based food service and facilities services provider.

RelaDyne comes to market

RelaDyne surfaced early in the day with plans to hold a lender call at 2 p.m. ET to launch a $649 million first-lien term loan B-2 due December 2028 talked at SOFR plus 450 bps with a 0.5% floor, an original issue discount of 99.75 and 101 soft call protection for six months, according to a market source.

Commitments are due at noon ET on Thursday, the source added.

RBC Capital Markets is leading the deal that will be used to reprice an existing $599 million term loan B-2 down from SOFR plus 500 bps and the $50 million in additional fungible debt being raised will repay outstanding ABL revolver borrowings.

RelaDyne is a Cincinnati-based provider of lubricant and fuel sales & distribution and equipment reliability services to the industrial, commercial and automotive industries.

Hillman launches

Hillman Group launched in the morning without a lender call a roughly $751.9 million first-lien term loan due July 14, 2028 talked at SOFR plus 250 bps with a 25 bps step-down at 3x first-lien net leverage, no CSA, a 0.5% floor, a par issue price and 101 soft call protection for six months, a market source remarked.

Consents are due at 2 p.m. ET on Thursday, the source added.

Jefferies LLC is leading the deal that will be used to reprice an existing first-lien term loan down from SOFR+CSA plus 275 bps with a 25 bps leverage-based step-down and a 0.5% floor. Current CSA is 11.448 bps one-month rate, 26.161 bps three-month rate and 42.826 bps six-month rate.

Hillman is a Cincinnati-based supplier of consumable hardware, personal protective equipment, and robotic and digital technologies.

Swissport on deck

Swissport set a lender call for 9 a.m. ET on Tuesday to launch a €1.2 billion equivalent U.S. and euro seven-year term loan B (/B+/BB+), with the U.S. tranche having a minimum size of $500 million, according to a market source.

Talk on the U.S. and euro term loans is SOFR/Euribor plus 450 bps to 475 bps with a 0% floor, an original issue discount of 98 to 98.5 and 101 soft call protection for six months, the source said.

Commitments are due at 5 p.m. ET on March 26 for the U.S. term loan and at 1 p.m. ET on March 26 for the euro term loan.

JPMorgan Chase Bank is the physical bookrunner on the U.S. term loan. Barclays, BofA Securities Inc. and JPMorgan are the physical bookrunners on the euro term loan. Citigroup Global Markets Inc., Morgan Stanley Senior Funding Inc. and UBS Investment Bank are the senior joint bookrunners, and Goldman Sachs, Natixis, NatWest, RBC Capital Markets and Santander are joint bookrunners. JPMorgan is the administrative agent.

The loans will be used to repay existing debt, fund a capital return to shareholders, add cash to the balance sheet, and pay transaction related fees and expenses.

Swissport is a Zurich-based provider of mission critical airport handling services.

NorthRiver joins calendar

NorthRiver Midstream scheduled a lender call for 11 a.m. ET on Tuesday to launch an $845.75 million senior secured covenant-lite term loan B due August 2030 talked at SOFR plus 250 bps to 275 bps with a 0% floor and a par issue price, a market source said.

Commitments are due at noon ET on Thursday, the source added.

BMO Capital Markets and RBC Capital Markets are leading the deal that will be used to reprice an existing term loan.

Brookfield Infrastructure is the sponsor.

NorthRiver Midstream is a Canadian gas gathering and processing business.

Crystal readies deal

Crystal Clean will hold a lender call at 11 a.m. ET on Tuesday to launch a $620 million first-lien term loan due Oct. 17, 2030 talked at SOFR plus 450 bps with a 0.5% floor, a par issue price and 101 soft call protection for six months, according to a market source.

Consents are due at 10:30 a.m. ET on Friday, the source added.

Jefferies LLC is leading the deal that will be used to reprice the company’s existing first-lien term loan down from SOFR plus 500 bps with a 0.5% floor.

Crystal Clean is a Hoffman Estates, Ill.-based provider of specialized environmental and waste management services.

Ultra Clean coming soon

Ultra Clean set a lender call for 2:30 p.m. ET on Tuesday to launch a $479 million senior secured term loan B due February 2028, a market source remarked.

The term loan has 101 soft call protection for six months, the source added.

Barclays, HSBC Securities (USA) Inc. and SMBC are leading the deal that will be used to refinance/extend by 2.5 years an existing term loan.

Ultra Clean is a Hayward, Calif.-based developer and supplier of critical subsystems, components and parts, and ultra-high purity cleaning and analytical services primarily for the semiconductor industry.

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