Mobilitie breaks; Ducommun, API Technologies revise deals; ATI Physical Therapy sets talk

By Sara Rosenberg

New York, June 13 - Mobilitie Investments II LLC's credit facility hit the secondary market on Monday, with the term loan B quoted above its original issue discount price, and Wendy's/Arby's Group Inc.'s term loan was relatively flat with news of an agreement to sell Arby's Restaurant Group Inc.

Over in the primary market, Ducommun Inc. made some revisions to its credit facility, raising pricing and adding a covenant to the accordion provision, and API Technologies Inc. downsized its deal while lifting the spread, Libor floor and discount.

Also, ATI Physical Therapy released price talk on its incremental debt, Ashland Inc. nailed down the launch date for its credit facility, Virtu Financial Inc. came out with the timing and size on its transaction, and Sophos and Dole Food Co. Inc. emerged with plans to bring new deals to market.

Additionally, Electric Infrastructure Alliance of America LLC has seen strong demand from investors towards its term loan, enough to oversubscribe the deal at initial terms.

Mobilitie frees up

Mobilitie, a Newport Beach, Calif.-based owner and constructor of communication towers, saw its credit facility break for trading on Monday, with the $240 million six-year term loan B quoted at par bid, par ½ offered, according to a trader.

Pricing on the term loan is Libor plus 400 basis points with a 1.5% Libor floor, and it was sold at an original issue discount of 991/2, after firming at the wide end of Libor plus 375 bps to 400 bps with a 1.25% to 1.5% Libor floor talk.

The company's $415 million credit facility (B2/BB-) also includes a $25 million five-year revolver and $150 million five-year 24-month-delayed-draw term loan for capital expenditures, both priced at Libor plus 375 bps with no Libor floor, after flexing up from Libor plus 350 bps. There is a ticking fee on the delayed-draw term loan that starts at 125 bps and becomes 75 bps once usage is over 50%.

TD Securities (USA) LLC and GE Capital Markets are leading the refinancing deal.

Wendy's holds around par

Wendy's/Arby's saw its term loan remain in the par context after the company announced that it has entered into an agreement to sell Arby's Restaurant to Roark Capital Group, according to traders. The company had revealed months ago that it was looking into the divestiture.

Specifically, the Atlanta-based quick-service restaurant company's term loan was quoted by one trader at par bid, par ½ offered, unchanged on the day, and by a second trader at 99¾ bid, par ¼ offered.

Under the agreement, Roark will pay about $130 million in cash at closing, and Wendy's will retain an 18.5% common stock interest in the Arby's business, valued at roughly $30 million.

Roark will also assume about $190 million of Arby's-related debt, consisting primarily of capital lease and sale-leaseback obligations, and invest an additional $50 million in Arby's that will be used for transaction expenses and to provide liquidity and growth capital.

The transaction is expected to close early in the third quarter, subject to regulatory approvals and customary conditions.

Il Fornaio holds steady

Il Fornaio Corp.'s $130 million six-year term loan was quoted at par ¼ bid, par ¾ offered on Monday, according to a market source, who said that the loan freed up for trading on Friday at par bid and then moved to par ¼ bid with no offers.

Pricing on the term loan is Libor plus 525 bps with a 1.25% Libor floor, and it was sold at an original issue discount of 991/2. There is 101 soft call protection for one year.

During syndication, the spread on the term loan was lowered from Libor plus 550 bps, the discount tightened from 99 and call protection was added.

The company's $145 million facility (B1/BB-) also includes a $15 million five-year revolver.

Proceeds from the Credit Suisse Securities (USA) LLC-led deal were used to help fund the now completed buyout of Il Fornaio, a Corte Madera, Calif.-based operator and franchiser of restaurants and one production bakery, by Roark Capital Group from Bruckmann, Rosser, Sherrill & Co.

Ducommun flexes higher

Moving to the primary, Ducommun lifted pricing on its $230 million senior secured credit facility (Ba2/BB) to Libor plus 425 bps from Libor plus 400 bps, while leaving the 1.25% Libor floor unchanged, according to a market source.

And, a 2.5 times leverage covenant was added on the $75 million accordion feature, the source remarked.

The facility consists of a $40 million five-year revolver and a $190 million six-year term loan B.

As before, the term loan is being offered at an original issue discount of 99 and 101 soft call protection for one year.

UBS Securities LLC and Credit Suisse Securities (USA) LLC are the joint lead arrangers and bookrunners on the deal.

Ducommun buying LaBarge

Proceeds from Ducommun's credit facility will be used to help fund the acquisition of LaBarge Inc. for $19.25 per share in cash, or $310.3 million, and refinance existing debt at both companies.

Other funds for the transaction will come from an expected $200 million senior unsecured notes offering that is backed by a commitment for a $200 million senior unsecured bridge loan with pricing of Libor plus 675 bps if ratings are B3/B- and Libor plus 750 bps if ratings are lower, with a 1.25% Libor floor.

Closing is expected in the second quarter, subject to approval of LaBarge shareholders and certain other customary conditions, including expiration of applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

Ducommun is a Carson, Calif.-based provider of engineering and manufacturing services to the aerospace and defense industry. LaBarge is a St. Louis-based supplier of electronics manufacturing services.

API reworks deal

Also coming out with changes was API Technologies Inc., as it trimmed its five-year term loan B to $170 million from $200 million, raised pricing to Libor plus 625 bps from talk of Libor plus 450 bps to 475 bps, lifted the Libor floor to 1.5% from 1.25% and moved the original issue discount to 96½ from 99 to 991/2, according to a market source.

As before, the loan includes 101 soft call protection for one year.

The company funded the term loan B on June 1 and disclosed in an 8-K filed with the Securities and Exchange Commission that pricing was being discussed at Libor plus 600 bps with a 1.5% Libor floor.

However, the filing also said that for up to 90 days following the date of the credit agreement, terms were subject to market flex provisions in order to facilitate syndication of the term loan, and a market source reiterated the point, telling Prospect News that the pricing terms outlined in the filing were not final.

Morgan Stanley & Co. Inc. is leading the deal and is asking for commitments by end of day Thursday.

API getting revolver

API Technologies' now $185 million senior credit facility (B2/BB-), down from an original size of $220 million, also provides for a $15 million three-year revolver that was downsized from $20 million. This downsizing was discussed in the 8-K filing, which disclosed that the tranche includes an option for a $5 million increase.

Proceeds, along with equity - upsized to account for the term loan downsizing - were used to help fund the already completed acquisition of Spectrum Control Inc. for $20 per share, or about $270 million.

API is a Ronkonkoma, N.Y.-based provider of secure communications, electronic components and subsystems and contract manufacturing services to the defense and aerospace industries. Spectrum is a Fairview, Pa.-based designer and manufacturer of high performance, custom services for the defense, aerospace, industrial and medical industries.

ATI reveals talk

In more primary happenings, ATI Physical Therapy held a bank meeting on Monday to launch $50 million of credit facility add-ons, at which time it was disclosed that the debt is being talked in line with existing pricing at Libor plus 550 bps with a 2% Libor floor, according to a market source.

The incremental debt consists of a $40 million term loan, which is being offered at a discount of 991/2, and a $10 million revolver.

When the existing term loan was obtained in 2010, it was sold at a discount of 97.

Barclays Capital Inc. is the lead bank on the deal that will be used for acquisition financing.

ATI Physical Therapy is a Bolingbrook, Ill.-based rehabilitation provider.

Ashland sets launch

Ashland zeroed in on timing for its $3.65 billion credit facility, with the scheduling of a bank meeting for 10 a.m. ET on Thursday, according to a market source. Previously, all that was known on timing was that the launch was expected to take place around the mid-June timeframe.

The facility consists of a $750 million undrawn five-year revolver, a $1.2 billion five-year term loan A and a $1.7 billion seven-year term loan B, with official price talk not yet available, the source said.

However, the company outlined expected pricing in the commitment letter filed with the SEC, saying that the revolver and term A are expected to be priced at Libor plus 225 bps, with the revolver having a 40 bps unused fee, and the term B is expected to be priced at Libor plus 275 bps with a step-down to Libor plus 250 bps at total leverage of 2.5 times and a 1% Libor floor.

The letter also said that the spread on the revolver and the A loan can range from Libor plus 175 bps to 250 bps, and the revolver unused fee can range from 30 bps to 50 bps, based on corporate ratings.

Ashland lead banks

Citigroup Global Markets Inc., Scotia Capital (USA) Inc., Bank of America Merrill Lynch and U.S. Bank are the joint lead arrangers and bookrunners on Ashland's credit facility.

A senior managing agent round for the credit facility was already under way at the start of this month and was expected to wrap up late last week.

Proceeds, along with cash on hand, will be used to help fund the acquisition of International Specialty Products Inc., a Wayne, N.J.-based specialty chemical manufacturer of functional ingredients and technologies, for $3.2 billion in cash.

Closing is anticipated prior to the end of the September quarter, subject to satisfaction of customary conditions and the receipt of U.S. and European Union regulatory approvals.

Ashland is a Covington, Ky.-based provider of specialty chemical products and services.

Virtu details surface

Virtu Financial revealed that it will be holding a bank meeting on Wednesday to launch a proposed $320 million term loan, according to a market source.

Proceeds will be used to help fund the company's merger with Madison Tyler Holdings LLC, a Los Angeles-based market maker and electronic trading firm.

At the time that the merger was announced, Virtu had said that it would be getting debt financing and outlined the joint lead arrangers and bookrunners as Credit Suisse Securities (USA) LLC, Bank of America Merrill Lynch and Barclays Capital Inc.

In connection with the merger, Virtu, a New York-based electronic market maker and financial technology developer, will receive a strategic growth investment from Silver Lake.

Sophos readies deal

Sophos has set a bank meeting for Wednesday to launch a proposed roughly $460 million six-year senior secured credit facility (B+) led by RBC Capital Markets LLC, according to a market source.

The facility consists of a $20 million revolver, a $280 million term loan and a €110 million term loan, the source said. Price talk is not yet available.

Proceeds will be used to refinance existing bank debt and fund the acquisition of Astaro.

Sophos' existing credit facility was obtained last summer as a $229.4 million six-year term loan B, including a $25 million euro-equivalent tranche, priced at Libor/Euribor plus 575 bps with a 2% Libor floor and sold at an original issue discount of 96, and a $75 million six-year euro equivalent term loan A and a $20 million six-year revolver, both priced at Libor plus 450 bps.

Sophos is an IT security and data protection firm based in Boston and Oxford, U.K. Astaro is a provider of network security services based in Wilmington, Mass., and Karlsruhe, Germany.

Dole holding call

Dole Food scheduled a conference call for 3 p.m. ET on Tuesday to launch a proposed $1.25 billion senior secured credit facility that consists of a $350 million multi-currency asset-based revolver, a $315 million term loan B and a $585 million term loan C, according to a market source.

The term loan C is being done at Solvest Ltd., a wholly owned Bermuda subsidiary of Dole.

Deutsche Bank Securities Inc. is the left lead on the deal that will be used to repay the existing asset-based revolver and Dole and Solvest term loan borrowings as well as for general corporate purposes.

In 2010, Dole obtained a $1.2 billion credit facility, consisting of a $350 million four-year asset-based revolver priced at Libor plus 400 bps with no Libor floor and an $850 million seven-year term loan priced at Libor plus 325 bps with a 1.75% Libor floor that was sold at an original issue discount of 99.

Dole is a Westlake Village, Calif.-based fruit and vegetables company.

Electric Infrastructure loan

Electric Infrastructure Alliance of America's $666.7 million seven-year construction and term loan facility is oversubscribed, and the transaction is targeted to allocate and close towards the end of this week, according to a market source.

Pricing on the loan is Libor plus 200 bps during construction, stepping up to Libor plus 225 bps from the commercial operation date through the third anniversary of the commercial operation date and to Libor plus 250 bps thereafter. There is also a 75 bps unused fee.

RBC Capital Markets LLC, RBS Securities Inc. and SG Americas Securities LLC are joint lead arrangers and bookrunners on the deal. Mizuho, Scotia Capital and SMBC are managing lead arrangers.

Proceeds will be used to back the construction of transmission facilities as part of the Texas Competitive Renewable Energy Zones program. Electric Infrastructure was formed to invest in the project.

Rentech wraps loan

In other news, Rentech Energy Midwest Corp. closed on its $150 million five-year term loan, according to a news release. It is priced at Libor plus 850 bps with a 1.5% Libor floor, was sold at an original issue discount of 98 and has call protection of 102 in year one and 101 in year two.

Last month, pricing on the loan had firmed at the high end of revised talk of Libor plus 800 bps to 850 bps, up from initial talk of Libor plus 650 bps. In addition, the size was reduced from $170 million, the maturity was shortened from six years and amortization was increased to 10% per year.

Credit Suisse Securities (USA) LLC led the deal that was used to refinance the company's 2010 senior secured credit facility and fund a dividend.

Rentech Energy is an East Dubuque, Ill.-based manufacturer and seller of nitrogen fertilizer products and is a subsidiary of Los Angeles-based Rentech Inc., a provider of clean energy services.

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