Catalent Pharma, Focus Brands, Quintiles free up; EMI, Nuveen, Citadel Plastics rework deals

By Sara Rosenberg

New York, Feb. 22 - Catalent Pharma Solutions Inc. firmed pricing on its term loan on Wednesday and then the debt broke for trading, and Focus Brands Inc.'s credit facility emerged in the secondary market too.

Also in trading, Quintiles Transnational Holdings Inc.'s new holdco PIK toggle term loan freed up and its existing term loan was softer, and Huntsman International LLC's dipped with amend and extend news.

Over in the primary, EMI Music Publishing came out with changes to its term loan B that included reducing the coupon and tightening the original issue discount as the tranche was well oversubscribed.

Continuing on the topic of changes, Nuveen Investments firmed pricing on its second-lien term loan at the low end of guidance and trimmed the original issue discount, and Citadel Plastics Holdings Inc. cuts spread and discount on its deal.

In more primary happenings, Swift Transportation Co. released pricing guidance on its term loans with launch, and Centaur LLC and Weight Watchers International Inc. began circulating talk on their credit facilities in preparation for their upcoming meetings.

Catalent hits secondary

Catalent Pharma Solutions $400 million incremental term loan B (BB-) due Sept. 15, 2017 freed up for trading on Wednesday afternoon with levels seen at 98 7/8 bid, par 3/8 offered on the open, and then it rose to par ¼ bid, par ¾ offered, according to a market source.

Pricing on the loan firmed during the day at Libor plus 400 basis points, the high end of the Libor plus 375 bps to 400 bps talk, while the 1.25% Libor floor, original issue discount of 99 and 101 soft call protection for one year were left unchanged.

Proceeds from the loan and $27 million of cash on hand funded the recently completed $410 million purchase of Aptuit LLC's clinical trial supplies business.

Pro forma net debt to adjusted EBITDA is 5.8 times and adjusted EBITDA to interest expense is 2.3 times.

Catalent extends loans

With the new term loan, Catalent was seeking an extension of at least 50% of its existing term loans to Sept. 15, 2016 from April 2014, and that goal was exceeded as about 80% of the debt was extended, a source said.

The company extended roughly $800 million of its $1 billion term loan and about €207.7 million of its €253 million term loan at pricing of Libor/Euribor plus 400 bps, versus non-extended pricing of Libor/Euribor plus 225 bps. There is 101 soft call protection for one year on the extended debt.

Lenders were offered a 10 bps consent fee.

Morgan Stanley Senior Funding Inc. acted as the lead arranger and bookrunner on the new term loan, and the sole lead arranger and joint bookrunner on the amendment. Other bookrunners on the amendment include Deutsche Bank Securities Inc., Goldman Sachs & Co. and J.P. Morgan Securities LLC.

Catalent is a Somerset, N.J.-based provider of advanced technologies and development, manufacturing and packaging services for pharmaceutical, biotechnology and consumer health care companies.

Focus Brands breaks

Focus Brands' credit facility began trading on Wednesday as well, with the $305 million six-year first-lien term loan B (B1/B) quoted at 99½ bid, par ¼ offered on the open, and then it moved up to par bid, par ½ offered, according to a trader.

Pricing on the first-lien is Libor plus 500 bps with a 1.25% Libor floor, and it was sold at an original issue discount of 99. There is 101 soft call protection for one year.

The company's $435 million credit facility also provides for a $15 million five-year revolver (B1/B) and a $115 million 61/2-year second-lien term loan (Caa1/CCC+) that is priced at Libor plus 900 bps with a 1.25% Libor floor and an original issue discount of 98. The second-lien loan has call protection of 103 in year one, 102 in year two and 101 in year three.

Focus Brands div recap

Proceeds from Focus Brands' Credit Suisse Securities (USA) LLC-led credit facility will be used to repay existing bank debt and fund a dividend.

During syndication, the first-lien term loan was upsized from $290 million as the second-lien term loan was downsized from $130 million. Also, the spread on the first-lien loan was reduced from Libor plus 550 bps and the discount was revised from 98.

Total leverage is 5.8 times. As a result of the change in term loan sizes, first-lien leverage is 4.2 times, versus 4.0 times under the original structure.

Focus Brands is an Atlanta-based franchisor and operator of ice cream stores, bakeries, restaurants and cafes.

Quintiles tops OID

Another deal to break was Quintiles' $300 million four-year and 364-day holdco PIK toggle term loan (B3/B), with levels quoted at 99¼ bid, 99¾ offered, according to a trader.

Meanwhile, the company's existing term loan dropped to 99 bid, par offered from 99½ bid, par ¼ offered with the launch of the new loan in the morning, the trader said.

Pricing on the holdco loan 7½% fixed, with an original issue discount of 97.959, and if the company elects PIK, pricing will be 75 bps higher, sources said. There is call protection of 102 in years one to three and 101 in year four.

J.P. Morgan Securities LLC, Barclays Capital Inc. and Morgan Stanley & Co. Inc. are the joint bookrunners on the new loan that will be used to fund a distribution to shareholders.

Quintiles is a Durham, N.C.-based biopharmaceutical services company offering clinical, commercial, consulting and capital services.

Huntsman weakens

In more trading news, Huntsman's term loans were a little weaker following an announcement that the company will launch with a call on Thursday an amendment and extension proposal, according to a trader.

Post news, the extended term loan B was quoted at 97 bid, 98 offered, versus 97¼ bid, 98¼ offered, the non-extended term loan B was quoted at 99 bid, 99 ¾ offered, compared to 99 bid, par offered on the open and 99¼ bid, par ¼ on Tuesday, and the term loan C was quoted at 97 bid, 98 offered, unchanged from the open but down from 97¼ bid, 98¼ offered in the previous session, the trader said.

Through the transaction, the company wants to extend its $300 million revolver due 2014 to 2017 and its $652 million term loan B due 2014 to 2017.

Chatter is that the extended term loan will be priced at Libor plus 300 bps, versus non-extended pricing of Libor plus 150 bps.

J.P. Morgan Securities LLC, Citigroup Global Markets Inc. and Bank of America Merrill Lynch are leading the deal for the Salt Lake City, Utah-based differentiated chemicals company.

Gentiva remains steady

Gentiva Health Services Inc.'s term loan was unchanged at 95¼ bid with news that the company launched an amendment to investors to address financial covenants, according to a trader.

A few weeks ago, the company said that it expects to breach financial covenants this year due to the impact of the Medicare reimbursement rate decreases and the reduction in the consolidated leverage ratio during the year.

As of Dec. 31, the company's consolidated leverage ratio was 4.41 times, and on a net basis, excluding total cash and equivalents, the ratio was 3.67 times.

Bank of America Merrill Lynch is the lead bank on the deal.

Gentiva is an Atlanta-based provider of home health and hospice services.

EMI flexes lower

Moving to the primary, EMI Music reworked pricing on its $1.05 billion six-year term loan B to trim both spread and discount, and it is giving lenders until Friday to recommit to the deal, a market source told Prospect News.

Pricing on the B loan is now Libor plus 425 basis points with a 1.25% Libor floor and an original issue discount of 99, compared to initial talk of Libor plus 475 bps with a 1.25% Libor floor and a discount of 981/2, the source said. The 101 soft call protection for one year was left intact.

The company's $1.125 billion senior secured credit facility (Ba3/BB-) also provides for a $75 million five-year revolver. Pricing on this tranche is unchanged at Libor plus 475 bps with a 1.25% Libor floor and a 75 bps undrawn fee that is subject to one step-down.

UBS Securities LLC is the lead bank on the deal.

EMI being acquired

Proceeds from EMI's credit facility will be used to help fund its buyout for total consideration of $2.2 billion from a wholly owned subsidiary of Citigroup Inc.

The group buying the company includes Sony/ATV Music Publishing, a subsidiary of Sony Corp. of America that is co-owned by trusts formed by the Estate of Michael Jackson, Mubadala Development Co. PJSC, Jynwel Capital Ltd., GSO Capital Partners LP and David Geffen.

As part of the transaction, Sony Corp. of America will invest about $325 million and, in conjunction with the Estate of Michael Jackson, own approximately 38% of the newly formed entity, with an ability to increase the investment and ownership up to 40%.

Closing is subject to certain conditions, including regulatory approvals.

EMI Music Publishing is a music publisher. Sony/ATV is a New York-based owner and administrator of copyrights by artists.

Nuveen updates pricing

Nuveen Investments made some revisions as well, setting the spread on its $500 million seven-year second-lien term loan (Caa1/CCC) at Libor plus 700 bps, the low end of the Libor plus 700 bps to 725 bps talk, and moving the original issue discount to 99 from 98, a market source said.

Unchanged was the loan's 1.25% Libor floor and call protection of 103 in year one, 102 in year two and 101 in year three.

Deutsche Bank Securities Inc., J.P. Morgan Securities LLC and Bank of America Merrill Lynch are leading the deal that will refinance an existing $500 million second-lien loan priced at 12.5%.

As before, the company is also looking to extend $500 million of its first-lien term loan debt to May 2017 from 2014 at pricing of Libor plus 550 bps, versus non-extended pricing of Libor plus 300 bps. The extended loan will have 101 soft call protection for one year.

Nuveen, a Chicago-based provider of investment services to institutions as well as individual investors, was seeking commitments/signatures by 5 p.m. ET on Wednesday.

Citadel reduces coupon

Citadel Plastics trimmed pricing on its $185 million credit facility to Libor plus 525 bps from Libor plus 550 bps, added a step-down to Libor plus 500 bps at less than 3.75 times leverage and tightened the discount to 99 from 98, according to a market source. The 1.5% Libor floor was left unchanged.

The facility consists of a $30 million five-year revolver and a $155 million six-year term loan.

GE Capital Markets and KeyBanc Capital Markets LLC are the lead banks on the deal that will be used to help fund the buyout of the company by Huntsman Gay Global Capital from Wind Point Partners.

Citadel Plastics is a Chicago-based provider of thermoset and thermoplastic compounds.

Swift reveals guidance

Also on the new deal front, Swift Transportation held a conference call on Wednesday to launch its credit facility, and with the call price talk on the $200 million term loan B-1 due Dec. 21, 2016 and $674 million term loan B-2 due Dec. 15, 2017 was disclosed, according to a market source.

The term loan B-1 is talked at Libor plus 375 bps to 400 bps with no Libor floor and an original issue discount of 993/4. Amortization is 10% in years one through three, 20% in year four and 25% in year five, with the balance due at maturity.

Meanwhile, the term loan B-2 is talked at Libor plus 375 bps to 400 bps with a 1.25% Libor floor and an original issue discount of 993/4. Amortization on the B-2 is 1% per year, with the remainder due at maturity.

The company's $1.274 billion credit facility also includes a $400 million revolver due Sept. 21, 2016.

Swift lead banks

Bank of America Merrill Lynch, Morgan Stanley Senior Funding Inc. and Wells Fargo Securities LLC are the lead arrangers on Swift Transportation's credit facility.

Proceeds will be used to refinance an existing senior secured credit facility, with the goal being to reprice and extend the maturities.

The existing deal was obtained in 2010 and consists of a $400 million five-year revolver and a $1.07 billion six-year term loan priced at Libor plus 450 bps with a 1.5% Libor floor.

Swift is a Phoenix-based transportation services company and truckload carrier.

Vantiv launches

Another deal to kick off was Vantiv LLC, and the Cincinnati-based integrated payment processor for merchants and financial institutions launched its up to $1.6 billion credit facility (Ba2) at previously outlined talk, according to a market source.

The facility consists of a $250 million five-year revolver and a $1 billion five-year term loan A, both talked at Libor plus 225 bps, with the revolver having a 50 bps undrawn fee, and a $250 million to $350 million seven-year term loan B talked at Libor plus 300 bps with a 1% Libor floor and an original issue discount of 99.

J.P. Morgan Securities LLC is the left lead bank on the refinancing deal, and Morgan Stanley & Co. LLC, Credit Suisse Securities (USA) LLC and Fifth Third Securities Inc. are bookrunners too.

Commitments are due on March 1.

Energy Transfer meeting

Energy Transfer Equity LP launched its $2.25 billion five-year senior secured term loan B as well, however, price talk was left as to be determined as the transaction is waiting on ratings, according to a market source. There is 101 soft call protection for one year.

Credit Suisse Securities (USA) LLC, Wells Fargo Securities LLC, BNP Paribas Securities Corp., RBS Securities Inc. and SunTrust Robinson Humphrey Inc. are the lead banks on the deal.

Commitments are due the week of March 5 and closing is expected the week of March 19.

Proceeds will be used to help fund the cash portion of the acquisition of Southern Union Co., and the final size will be determined by how many Southern Union shareholders choose to receive cash in exchange for their shares. The offer price for Southern Union is $44.25 in cash or one common unit per Southern Union share, and up to 60% of the $5.7 billion total consideration will be paid in cash.

Energy Transfer Equity is a Dallas-based provider of energy-related services. Southern Union is a Houston-based transporter, gatherer, processor and distributor of natural gas.

Centaur talk surfaces

Centaur released price talk of Libor plus 575 bps on its $240 million credit facility as the deal is getting ready to launch with a bank meeting at 11 a.m. ET on Thursday, according to a market source.

The facility is comprised of a $15 million revolver and a $225 million six-year first-lien term loan.

The term loan has a 1.25% Libor floor as well as 101 soft call protection for one year, and is being offered at an original issue discount of 98, the source remarked. The revolver has no floor.

Credit Suisse Securities (USA) LLC is the lead bank on the deal that will be used to refinance existing debt.

Centaur is an Indianapolis-based casino operator.

Weight Watchers timing

Weight Watchers joined next week's calendar, setting a bank meeting for Tuesday to launch a $3 billion credit facility that consists of a $300 million revolver, a $1.6 billion term loan A and a $1.1 billion term loan B, a market source said.

Furthermore, early guidance began making its way around the market, with the revolver and term loan A talked at Libor plus 225 bps to 250 bps, and the term loan B talked at Libor plus 275 bps to 300 bps with a 1% Libor floor and an original issue discount of 99, the source added.

Proceeds will be used to fund the company's buyback of common stock and amendment and extension of an existing roughly $1.36 billion senior secured credit facility.

According to filings with the Securities and Exchange Commission, at Oct. 1, the company's existing additional term loan A was priced at Libor plus 100 bps, its term loan B was priced at Libor plus 125 bps, its term loan C and term loan D were priced at Libor plus 225 bps, and its revolver II was priced at Libor plus 250 bps.

Weight Watchers buyback

Weight Watchers is planning on repurchasing up to $720 million of its stock through a modified Dutch auction tender offer at a price of $72 to $83 per share. The company will also acquire shares from Artal, which owns about 52% of its outstanding shares, at the same price as the one determined in the tender offer.

If the tender offer is fully subscribed, the company will repurchase a total of about $1.5 billion of its common stock through the tender offer and the Artal purchase agreement.

J.P. Morgan Securities LLC and Credit Suisse Securities (USA) LLC are leading the credit facility.

Weight Watchers is a New York-based provider of weight management services.

AMC wraps amendment

In other news, AMC Entertainment inc. has received the required consents for the amendment to its credit facility that provides for a new $300 million six-year senior secured term loan B-3 (Ba2/BB-/BB), according to a news release.

Pricing on the loan is Libor plus 325 bps after flexing during syndication from Libor plus 350 bps. There is a 1% Libor floor and 101 soft call protection for one year, and the debt was sold at an original issue discount of 99.

Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Goldman Sachs & Co. and J.P. Morgan Securities LLC led the deal that will be used, along with cash on hand, to fund a tender offer for up to $160 million of the company's $300 million of 8% senior subordinated notes due 2014 and to repay term loans due in 2013.

AMC Entertainment, a Kansas City, Mo.-based theatrical exhibition and entertainment company, has set an expiration date of March 6 for the notes tender offer.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.