Prestige trades up; DS Waters, Cequel, Safety-Kleen, Grifols, TransDigm tweaks deals

By Sara Rosenberg

New York, Feb. 9 - Prestige Brands Holdings Inc.'s term loan B was a little stronger during Thursday's session as the company released quarterly results that showed a year-over-year improvement in earnings, revenues and adjusted EBITDA.

Moving to the new deal front, DS Waters of America Inc. updated its credit facility structure, reducing the amount of first-lien debt while adding second-lien term loans, and pricing and call protection on the first-lien loans was sweetened.

Also coming out with changes was Cequel Communications Holdings I LLC, as the spread on its oversubscribed term loan B was lowered, and Safety-Kleen Systems Inc. reworked the tranching and pricing on its credit facility.

Additionally on the topic of revisions, Grifols carved out a euro tranche and downsized its total term loan B amount while adding a pricing step-down, and TransDigm Group Inc. trimmed the coupon and discount on its loan.

In more primary happenings, Everyware and Presidio Inc. released price talk as both of their news deals were presented to lenders during market hours, and NEW Asurion launched its unsecured term loan in line with earlier guidance.

Prestige Brands rises

Prestige Brands' term loan B headed up to par ¾ bid, 101 1/8 offered, from par 5/8 bid, 101 offered after the company came out with favorable fiscal 2012 third quarter numbers, according to a trader.

For the quarter, the company reported net income of $9.5 million, or $0.19 per diluted share, compared to net income of $2.2 million, or $0.04 per diluted share, in the prior year.

Net revenues for the quarter were $106.3 million, up 17.3% from $90.6 million in the fiscal 2011 third quarter.

And, non-GAAP adjusted EBITDA for the quarter was $31.1 million, versus $26 million in the previous year.

Prestige is an Irvington, N.Y.-based marketer of branded consumer products in the over-the-counter health care and household cleaning industries.

DS Waters restructures

Switching to the primary, DS Water of America released new terms on its $535 million credit facility, reworking the deal to include second-lien term loan debt and revising terms offered on the first-lien borrowings, according to a market source.

The 51/2-year first-lien term debt is now comprised of a $285 million funded tranche, down from $390 million, and a $55 million delayed-draw tranche, down from $75 million, the source said.

Pricing on the first-lien term loans is Libor plus 900 basis points, up from talk of Libor plus 675 bps to 700 bps, with the same 1.5% Libor floor and original issue discount of 98 as before. There is call protection of 103 in year one, 102 in year two and 101 in year three, revised from just 101 in year one previously, the source remarked.

In addition, the first-lien term loan now has a 75% excess cash flow sweep, up from 50%, and amortization of 1% in year one, 2.5% in year two and 5% in years three, four and five, compared to just 1% per annum under the original structure, the source continued.

DS Waters second-lien

With the downsizing to the first-lien term loans, DS Waters added a $105 million six-year funded second-lien term loan and a $20 million six-year delayed-draw second-lien term loan to its capital structure.

Price talk on the second-lien term loans is Libor plus 950 bps cash pay plus 400 bps PIK, with a 1.5% Libor floor and an original issue discount of 98, and the debt is non-callable for one year, then at 104 in year two, 103 in year three, 102 in year four and 101 in year five, the source added.

The credit facility still provides for a $70 million five-year ABL revolver.

Recommitments are due on Wednesday. The source said, however, that there were a "number of anchor orders" placed post the changes.

DS Waters lead banks

Credit Suisse Securities (USA) LLC, GE Capital Markets and Jefferies & Co. are the lead banks on DS Waters' credit faciltiy, with Credit Suisse the left on the term loan and GE the left on the revolver.

Proceeds will be used to refinance existing debt, and the delayed-draw term loans are available for acquisition funding.

First-lien leverage is 2.3 times and second-lien leverage is 3.2 times.

DS Waters is an Atlanta-based bottled water, water filtration and coffee service company.

Cequel flexes lower

Cequel Communications cut pricing on its $2.2 billion seven-year term loan B to Libor plus 300 bps from Libor plus 325 bps, while leaving the 1% Libor floor, original issue discount of 99 and 101 soft call protection for one year unchanged, according to market sources.

Recommitments were due at 2 p.m. ET on Thursday.

The company's $2.7 billion senior secured credit facility (Ba2/BB-) also provides for a $500 million five-year revolver priced at Libor plus 250 bps with no Libor floor.

Credit Suisse Securities (USA) LLC, Goldman Sachs & Co., J.P. Morgan Securities LLC, Bank of America Merrill Lynch and RBC Capital Markets LLC are leading the deal that will be used to refinance existing debt and fund a dividend.

Cequel, a St. Louis-based cable operator, will have secured leverage of 3.1 times and total leverage of 5.6 times.

Safety-Kleen revises deal

Safety-Kleen disclosed changes to its five-year credit facility (B1/BB-) on Thursday morning that included adjusting tranche sizes to end up with a total deal size of $450 million, as opposed to $400 million, and reverse flexing term loan B pricing, according to a market source.

Specifically, the revolver was increased to $225 million from $150 million and the term loan B was decreased to $225 million from $250 million, the source said.

Pricing on the term loan B is Libor plus 375 bps with a 1.25% Libor floor and an original issue discount of 99, versus initial talk of Libor plus 450 bps with a 1.25% floor and a discount of 98, the source continued. The 101 101 soft call protection for one year was left unchanged.

Recommitments are due by 3 p.m. ET on Friday.

Safety-Kleen repaying debt

Proceeds from Safety-Kleen's credit facility will be used to refinance an existing senior secured deal, including a revolver due in August 2012, fund share repurchases and for general corporate purposes.

J.P. Morgan Securities LLC is the lead bank on the deal.

Closing is targeted by mid-February.

Safety-Kleen is a Plano, Texas-based used oil recycling and re-refining, parts cleaning and environmental services company.

Grifols adds euro B loan

Grifols is now offering a €200 million tranche under its term loan B with talk of Euribor plus 350 bps with a step-down to Euribor plus 325 bps at less than 3.25 times total net leverage, a 1% floor, an original issue discount of 99½ and 101 soft call protection for one year, according to a market source.

The U.S. piece of the term loan is sized at $1.7 billion, meaning that the total tranche amount has been decreased to around $1.97 billion from $2.2 billion.

Pricing on the U.S. B loan is Libor plus 350 bps with the same floor, discount and call protection as the euro piece, and the tranche saw the addition of the step to Libor plus 325 bps at less than 3.25 times leverage as well, the source said.

Additionally, the company's revolver has been downsized to $200 million from $300 million.

Grifols term loan A

Grifols' now roughly $3.1 billion senior secured credit facility also includes a $600 million term loan A and a €220 million term loan A - sizes unchanged.

Recommitments were due at 5 p.m. ET on Thursday.

Deutsche Bank Securities Inc., Nomura, BBVA Securities Inc., BNP Paribas Securities Corp., HSBC Securities (USA) Inc. and Morgan Stanley & Co. LLC are the lead banks on the deal that will be used to refinance the company's existing credit facility.

Grifols is a Barcelona, Spain-based health care company.

TransDigm cuts pricing

TransDigm was yet another company to release changes on Thursday, reducing pricing on its $500 million add-on senior secured covenant-light term loan (Ba2/BB-) due Feb. 14, 2017 to Libor plus 300 bps from Libor plus 325 bps and moving the discount price to 99½ from 99, according to a market source. The 1% Libor floor and 101 soft call protection for one year were left unchanged.

Lead banks, Credit Suisse Securities (USA) LLC and UBS Securities LLC, are asking for recommitments by noon ET on Friday and allocations are expected next week.

Proceeds will be used to help fund the acquisition of AmSafe Global Holdings Inc. for $750 million from a group controlled by Berkshire Partners LLC and Greenbriar Equity Group LLC, and with the transaction, total senior secured debt is 2.9 times and total debt is 5.2 times.

The company is also asking to amend its existing credit facility to permit the incurrence of the term loan, leave the accordion feature intact and increase its revolver to $300 million from $245 million.

TransDigm, a Cleveland-based aircraft components company, is targeting a Monday close for the loan.

Everyware guidance emerges

In other news, Everyware held a bank meeting on Thursday to launch a proposed $150 million six-year term loan B, at which time talk of Libor plus 700 bps with a 1.5% Libor floor, an original issue discount of 98 and 101 soft call protection for one year was announced, a source told Prospect News.

Commitments towards the Barclays Capital Inc.-led B loan are due on Feb. 23.

The company's $225 million credit facility also includes a $75 million five-year ABL revolver led by Wells Fargo Securities LLC that is expected to have a pricing grid ranging from Libor plus 175 bps to 275 bps based on availability, the source remarked.

Proceeds will be used to refinance existing debt and pay a dividend in connection with the formation of the company through the merger of Oneida Ltd., a tabletop brand, and Anchor Hocking Co., a manufacturer and marketer of foodservice and retail glassware, by sponsor Monomoy Capital Partners.

Presidio sets talk

Presidio came out with price talk of Libor plus 550 bps with a 1.75% Libor floor and an original issue discount of 99½ on its $60 million add-on term loan that launched with a call on Thursday, according to a market source.

The spread and floor is in line with existing term loan B pricing, but the existing debt was sold at 98½ when obtained last year.

Lead banks, Barclays Capital Inc. and PNC Capital Markets LLC, are seeking commitments by Feb. 17 on the deal that will be used to help fund the acquisition of BlueWater Communications Group, a provider of IT infrastructure services.

Presidio is a Greenbelt, Md.-based provider of advanced technology infrastructure services.

Asurion launches

NEW Asurion launched with a bank meeting on Thursday its $1 billion 71/2-year senior unsecured term loan at talk of Libor plus 950 bps with a 1.5% Libor floor and an original issue discount of 96, which is in line with the early guidance that had come out a few days ago, according to a market source.

As expected, the loan is non-callable for two years, then at 102 in year three and 101 in year four.

Commitments are due on Feb. 16.

Morgan Stanley & Co. LLC is the lead bank on the deal that will be used to buy back equity.

Asurion is a Nashville-based provider of technology protection services.

American Dental closes

American Dental Partners Inc.'s buyout by JLL Partners Inc. for $19 per share has been completed, according to a news release. The transaction is valued at about $427.2 million on a fully diluted basis, or about equivalent to 8.0 times adjusted EBITDA of $53.5 million.

For the transaction, American Dental got a $241 million senior secured credit facility (B1/B) comprised of a $36 million five-year revolver and a $205 million six-year term loan B, and priced at Libor plus 575 bps with a 1.5% Libor floor and an original issue discount of 98.

KeyBanc Capital Markets LLC, CIT Capital Securities and NXT Capital LLC acted as the leads on the deal.

American Dental is a Wakefield, Mass.-based business partner to dental group practices.

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