ATI, Blue Ribbon, Calpine break; Endo falls with guidance change; Anchor Glass sets changes

By Sara Rosenberg

New York, May 6 – ATI Physical Therapy and Blue Ribbon LLC (Pabst) saw their loans emerge in the secondary market on Friday, and Calpine Corp. finalized pricing on its term loan B-7 at the high end of talk before breaking for trading as well.

In more trading happenings, Endo International plc’s term loan B weakened on the back of the company’s announcement that full-year financial guidance has been lowered.

Back in the primary market, Anchor Glass Container Corp. increased the size of its add-on term loan, set the spread at the low end of guidance and tightened the original issue discount, and Montreign Operating Co. LLC and Pilot Travel Centers LLC surfaced with new deal plans.

ATI frees up

ATI Physical Therapy’s credit facility began trading on Friday, with the $660 million seven-year first-lien covenant-light term loan quoted at 99¼ bid, 100¼ offered, according to a trader.

Pricing on the first-lien term loan is Libor plus 450 basis points with a 1% Libor floor, and the debt was sold at an original issue discount of 99. Included in the loan is 101 soft call protection for one year.

During syndication, the first-lien term loan was upsized from $635 million, the spread was lowered from Libor plus 500 bps, the discount firmed at the tight end of the 98 to 99 talk, the call protection was extended from six months, and the MFN sunset was removed.

The company’s $955 million senior secured credit facility also includes a $70 million five-year revolver (B1) and a $225 million eight-year second-lien term loan that was privately placed.

ATI being acquired

Proceeds from ATI’s credit facility will be used to help fund its buyout by Advent International from KRG Capital Partners.

Barclays, HSBC Securities (USA) Inc. and Jefferies Finance LLC are leading the new debt.

First-lien leverage is 4.4 times, and total leverage is 5.9 times.

Closing on the buyout is expected this quarter, subject to regulatory approval and other customary conditions.

Upon completion, ATI’s current management team, led by Dylan Bates, will retain a significant minority stake in the company.

ATI is a Bolingbrook, Ill.-based outpatient physical therapy provider.

Calpine sets spread, trades

Calpine firmed pricing on its $500 million seven-year covenant-light term loan B-7 (Ba2) at Libor plus 300 bps, the high end of the Libor plus 275 bps to 300 bps talk, a market source said.

As before, the term loan has no Libor floor, an original issue discount of 99 and 101 soft call protection for six months.

With final terms in place, the B-7 loan broke for trading during the session and levels were quoted at 99 bid, 99½ offered, a trader added.

Citigroup Global Markets Inc., Bank of America Merrill Lynch, MUFG, Barclays, BNP Paribas Securities Corp., Credit Agricole, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Morgan Stanley Senior Funding LLC, RBC Capital Markets and UBS Investment Bank are leading the deal that will be used to refinance a portion of the company’s existing term loan B-3 due 2019.

Closing is expected on Tuesday.

Calpine is a Houston-based generator of electricity from natural gas and geothermal resources.

Blue Ribbon breaks

Blue Ribbon’s fungible $135 million incremental first-lien term loan (B1) due Nov. 13, 2021 and repriced existing first-lien term loan due Nov. 13, 2021 freed up for trading as well, with levels quoted at par bid, 100½ offered, according to a market source.

Pricing on the incremental term loan and repriced term loan is Libor plus 400 bps with a 1% Libor floor. The incremental loan was issued at a discount of 99.5, and the repricing was done at par, and all of the debt has 101 soft call protection for six months.

During syndication of the incremental loan, pricing was reduced from Libor plus 450 bps, and the repricing of the existing term loan from Libor plus 450 bps was added to the transaction.

Including the incremental term loan, the company’s first-lien term loan totals $495 million.

Blue Ribbon leads

UBS Investment Bank, Credit Suisse Securities (USA) LLC, BMO Capital Markets, Barclays, Rabobank and Wells Fargo Securities LLC are the bookrunners on Blue Ribbon’s loan.

Proceeds from the incremental term loan will be used to repay second-lien term loan debt.

In connection with the incremental loan, the company sought certain amendments to its credit agreement, for which lenders were offered a 5-bps consent fee.

Blue Ribbon is a Los Angeles-based brewing company.

Endo softens

Also in the secondary market, Endo’s term loan B dropped to 98¼ bid, 98¾ offered from 99 3/8 bid, 99 7/8 offered in reaction to the release late Thursday of revised financial guidance for 2016, a trader remarked.

For 2016, the company is now expecting total revenues to be between $3.87 billion and $4.03 billion, down from prior expectations of between $4.32 billion and $4.52 billion, reported diluted (GAAP) earnings per share from continuing operations to be between $0.25 and $0.55, versus prior guidance of between $2.25 and $2.60, and adjusted diluted earnings per share from continuing operations to be between $4.50 to $4.80, compared to previous expectations of between $5.85 and $6.20.

Along with the change in guidance, the company released first quarter numbers that showed loss from continuing operations of $89 million, or $0.40 per diluted share, compared to income from continuing operations of $150 million, or $0.85 per diluted share, in the first quarter of 2015.

Total revenues for the quarter were $964 million, versus $714 million in the prior year’s first quarter.

Endo is Dublin-based specialty pharmaceutical company.

Anchor Glass revised

Returning to the primary market, Anchor Glass lifted its fungible add-on term loan (B2/BB-) due June 2022 to $140 million from $110 million, finalized pricing at Libor plus 375 bps, the tight end of the Libor plus 375 bps to 400 bps talk, and changed the original issue discount to 99.5 from talk of 98.5-99, according to a market source.

As before, the term loan has a 1% Libor floor and 101 soft call protection for one year.

Recommitments were due by the end of the day on Friday and allocations are expected on Monday, the source said.

Credit Suisse Securities (USA) LLC is leading the loan that will be used to fund a dividend.

In connection with the add-on, the Tampa, Fla.-based manufacturer of glass packaging products is looking to amend its existing credit facility to allow for the dividend and increase pricing on its existing term loan from Libor plus 325 bps with a 1% Libor floor to match pricing on the add-on term loan.

Lenders are still offered a 25-bps fee for the amendment.

Montreign on deck

Montreign Operating set a bank meeting for 10:30 a.m. ET in New York on Tuesday to launch a $400 million six-year first-lien term loan that is talked at Libor plus 850 bps to 900 bps with a 1% Libor floor, an original issue discount of 98 and call protection of non-callable for three years, then at 102 in year four and 101 in year five, a market source remarked.

Commitments are due on May 20, the source added.

Credit Suisse Securities (USA) LLC is leading the deal that will be used by the casino operator to fund the development of the Montreign Resort Casino in the Hudson Valley region in New York.

Pilot Travel plans call

Pilot Travel Centers scheduled a lender call for 11 a.m. ET on Monday to launch a new loan, according to a market source.

Bank of America Merrill Lynch, Wells Fargo Securities LLC, SunTrust Robinson Humphrey Inc. and U.S. Bank are leading the deal.

Further details on the transaction are not yet available, the source said.

Pilot Travel is a Knoxville, Tenn.-based operator of travel centers and travel plazas.

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