Diebold, Alvogen, Blount break; Valeant rises; MGM Growth Properties deal updates surface

By Sara Rosenberg

New York, April 5 – Diebold Inc. reworked size and pricing on its term loan B, and then the U.S. tranche hit the secondary market above its revised issue price, and Alvogen modified the original issue discount on its incremental term loan and broke as well.

In more happenings, Blount International Inc.’s credit facility freed up for trading, and Valeant Pharmaceuticals International Inc.’s term loans were stronger as the company announced the results of its now completed review of Philidor and related accounting matters and changes to its amendment proposal.

Also, MGM Growth Properties Operating Partnership LP lowered price talk on its term loan B and tightened original issue discount guidance, Samsonite revealed price talk on its credit facility with launch, Netsmart Technologies Inc. released tranching and pricing guidance on its buyout financing facility, and Sedgwick Claims Management Services Inc. approached investors with a new term loan.

Furthermore, Protection 1 (Prime Security Services Borrower LLC) came out with timing on the launch of its incremental credit facility for the ADT Corp. buyout and merger transaction, and Novolex joined this week’s new issue calendar.

Diebold restructures, trades

Diebold lifted its seven-year covenant-light U.S. and euro term loan B to roughly $1.4 billion equivalent from roughly $1.3 billion equivalent, by trimming the U.S. piece to $1 billion from $1.1 billion and increasing the euro piece to €350 million from €200 million, according to a market source.

Additionally, pricing on the U.S. term loan B was set at Libor plus 450 basis points, the low end of the Libor plus 450 bps to 475 bps talk, and the original issue discount finalized at 99, the tight end of revised talk of 98.5 to 99 and tight of original talk of 98.5.

Pricing on the euro term loan B was cut to Euribor plus 425 bps from talk of Euribor plus 450 bps to 475 bps.

All of the term loan B debt still has a 0.75% floor and 101 soft call protection for one year.

Commitments were due by 1:30 p.m. ET on Tuesday, and with final terms in place, the U.S. term loan B began trading in the afternoon, with levels quoted by one trader at 99 5/8 bid, 100 1/8 offered and by a second trader at 99¾ bid, 100¼ offered.

Diebold term A, revolver

Along with the term loan B debt, Diebold’s now roughly $2.4 billion credit facility includes a $230 five-year million term loan A, a $250 million five-year delayed-draw term loan A and a $520 million five-year revolver.

J.P. Morgan Securities LLC and Credit Suisse Securities (USA) LLC are leading the deal that will be used to help fund the acquisition of Wincor Nixdorf AG for €38.98 in cash plus 0.434 of a Diebold common share per share. This transaction values Wincor, including net debt, at about $1.8 billion.

The company is also using $400 million of bonds to fund the acquisition. The bonds were downsized from $500 million with the term loan B upsizing, the source added.

Diebold is a North Canton, Ohio-based provider of self-service delivery, value-added services and software primarily to the financial industry. Wincor is a Paderborn, Germany-based provider of IT solutions and services to retail banks and the retail industry.

Following completion of the acquisition, the combined company will be named Diebold Nixdorf and will be operated from headquarters in North Canton, Ohio, and Paderborn, Germany.

Alvogen tweaks OID, breaks

Alvogen changed the original issue discount on its fungible $55 million incremental first-lien term loan to 98.9376 from 98.5, a market source said.

Pricing on the incremental loan is Libor plus 500 bps with a 1% Libor floor, which matches existing term loan pricing, and all of the first-lien term loan debt is getting 101 soft call protection for six months.

The deal allocated on Tuesday, and was seen in the secondary market at 99 bid, 99½ offered, a trader added.

Jefferies Finance LLC is leading the loan that will be used for general corporate purposes and to potentially fund a portion of the acquisition of County Line Pharmaceuticals, a Wisconsin-based specialty generic pharmaceutical company.

Alvogen is a generic pharmaceutical company.

Blount hits secondary

Blount International’s credit facility also broke for trading, with the $475 million seven-year first-lien term loan quoted at 98 bid, 99 offered, a trader said.

Pricing on the term loan is Libor plus 625 bps with a 1% Libor floor, and it was sold at an original issue discount of 97. The debt has 101 soft call protection for one year.

The company’s $550 million senior secured credit facility (B1/B+) also includes a $75 million five-year revolver.

Proceeds will be used with $475 million in equity to fund the buyout of the company by American Securities LLC and P2 Capital Partners LLC for $10.00 in cash per share. The transaction is valued at about $855 million, including the assumption of debt.

Total leverage is 4.4 times, and net total leverage is 4 times.

Blount lead banks

Barclays, KeyBanc Capital Markets Inc. and ING Capital are leading Blount’s credit facility that underwent a number of revisions last week.

Under those changes, the term loan was upsized from $300 million as a $175 million equivalent euro-denominated seven-year first-lien term loan was eliminated from the capital structure, pricing was increased from Libor plus 600 bps, the discount widened from 98, and the definition of consolidated EBITDA was modified.

Also during syndication, modifications were made to the incremental allowance, the excess cash flow sweep, the maximum total net leverage ratio and the definition of consolidated EBITDA.

Closing on the buyout is expected in the first half of this year, subject to approvals by Blount’s shareholders and regulatory authorities and the satisfaction or waiver of customary conditions.

Blount is a Portland, Ore.-based manufacturer and marketer of replacement parts, equipment and accessories in forestry, lawn and garden; farm, ranch and agriculture; and concrete cutting and finishing.

Valeant gains ground

Also in trading, Valeant’s term loans rose in the morning after the company said in a news release that it completed its review of various Philidor and related accounting matters, and no additional items were identified that would require restatements beyond those previously disclosed, a trader remarked.

Post the restatement news, the term loans E and F were quoted at 94¾ bid, 95½ offered, up from 94 bid, 95 offered, the term loans C and D were quoted at 95 bid, 95¾ offered, up on the bid side from 94¾ bid, 95¾ offered, and the term loan A3 was quoted at 95½ bid, 96½ offered, up from 95¼ bid, 96¼ offered, the trader added.

Then, later in the day, the debt continued to rise as investors were told of changes to the company’s proposed amendment, including the addition of leverage-based pricing grid and requirements for more deleveraging than originally planned, another trader remarked.

That trader was quoting the term loans E and F at 95¾ bid, 96½ offered by late day.

Valeant extending deadlines

As previously reported, Valeant is asking for the amendment so as to extend the deadline for filing its form 10-K to May 31, to extend the deadline for filing its form 10-Q for the quarter ending March 31 to July 31 and to waive the cross-default to its indentures that arose when the 10-K was not filed on March 15.

Lenders are still being offered a 50-bps amendment fee.

The company is in the process of restating financial statements and those statements will be included in its 10-K for the year ended Dec. 31, 2015, which is expected to be filed with the Securities and Exchange Commission on or before April 29.

The company believes that after giving effect to the restatement, it will have remained in compliance with all of the financial maintenance covenants in its credit facility at the end of each affected quarterly period.

Valeant is a Laval, Quebec-based specialty pharmaceutical company.

MGM Growth revises talk

Back in the primary market, MGM Growth Properties trimmed price talk on its $1.85 billion seven-year covenant-light term loan B to Libor plus 325 bps to 350 bps from Libor plus 400 bps to 425 bps and moved original issue discount talk to 99.5 to 99.75 from 99, according to a market source.

As before, the term loan B has a 0.75% Libor floor and 101 soft call protection for six months.

The company’s $2.75 billion senior secured credit facility (B1/BB) also includes a $600 million five-year revolver and a $300 million five-year term loan A.

Commitments are due at 5 p.m. ET on Wednesday, moved up from noon ET on Friday, the source added.

Bank of America Merrill Lynch, J.P. Morgan Securities LLC, Morgan Stanley Senior Funding Inc., Barclays, Citigroup Global Markets Inc. and Deutsche Bank Securities Inc. leading the deal.

MGM Growth refinancing

Proceeds from MGM Growth’s credit facility, $1.05 billion of senior unsecured notes and $800 million of equity proceeds will be used to repay about $4 billion of debt that the operating partnership is expected to assume from MGM Resorts International and some of its subsidiaries, to help pay around $150 million of fees and expenses associated with the financings and related transactions and for general corporate purposes.

At closing, $150 million is expected to be drawn under the revolver.

MGM Growth Properties is Las Vegas-based real estate investment trust that is being spun off from MGM Resorts, a Las Vegas-based operator of resorts and casinos.

Samsonite sets guidance

Samsonite held its bank meeting on Tuesday morning, and with the event, price talk on its $2,425,000,000 senior secured credit facility (Ba2/BBB-) surfaced, according to a market source.

The $500 million five-year revolver and $1.25 billion five-year term loan A are talked at Libor plus 275 bps with no Libor floor and an original issue discount that is subject to a grid, and the $675 million seven-year term loan B is talked at Libor plus 375 bps to 400 bps with a 0.75% Libor floor, a discount of 99 to 99.5 and 101 soft call protection for six months, the source said.

Commitments are due on April 15.

Morgan Stanley Senior Funding, Inc., HSBC Bank USA, SunTrust Robinson Humphrey Inc., MUFG, Barclays, Citizens Capital Markets, ING, Fifth Third and Bank of China are leading the deal, with Morgan Stanley the administrative agent on the term loan B and HSBC the administrative agent on the term loan A.

Samsonite buying Tumi

Proceeds from Samsonite’s credit facility and cash on hand will be used to fund the acquisition of Tumi Holding Inc. for $26.75 per share in cash, or about $1.82 billion, and to refinance existing credit facilities at both companies.

Closing is expected in the second half of this year, subject to the receipt of approvals by Samsonite and Tumi shareholders, the receipt of required regulatory approvals and the satisfaction of other customary conditions.

Samsonite International SA is the borrower on the revolver and Samsonite IP Holdings is the borrower on the term loans.

Hong Kong-based Samsonite and South Plainfield, N.J.-based Tumi are manufacturers of bags and luggage.

Netsmart releases details

Netsmart also held a morning bank meeting, and with the event, structure and price talk were announced on its $612 million senior secured credit facility, a market source said.

The facility consists of a $50 million five-year revolver talked at Libor plus 525 bps to 550 bps with no Libor floor; a $395 million seven-year first-lien term loan talked at Libor plus 525 bps to 550 bps with a 1% Libor floor, an original issue discount of 98.5 and 101 soft call protection for six months; and a $167 million 7.5-year second-lien term loan talked at Libor plus 950 bps with a 1% Libor floor, a discount of 97.5 and call protection of 103 in year one and 101 in year two, the source added.

Commitments are due on April 18.

UBS Investment Bank is leading the deal that will be used to help fund the company’s new venture with GI Partners and Allscripts Healthcare Solutions Inc. as investors. As a part of the venture, Netsmart will merge the Allscripts Homecare business unit into the Netsmart CareFabric suite of solutions.

Netsmart is an Overland Park, Kan.-based IT company focused on health and human services.

Sedgwick seeks term loan

Sedgwick Claims Management Services launched a non-fungible $300 million incremental first-lien term loan (B) due February 2021 with talk of Libor plus 425 bps with a 1% Libor floor, an original issue discount of 98 and 101 soft call protection for six months, according to a market source.

Commitments are due on Thursday, the source said.

KKR Capital Markets and MCS Capital Markets are leading the loan that will be used with cash on hand to fund a $375 million dividend to the sponsors.

Sedgwick is a Memphis, Tenn.-based provider of technology-enabled claims and productivity management solutions.

Protection 1 timing emerges

In more primary happenings, Protection 1 set a bank meeting in New York for Thursday to launch its previously announced $1.81 billion incremental senior secured credit facility (Ba2/BB-), according to a market source.

The facility consists of a $255 million five-year revolver and a $1,555,000,000 six-year covenant-light term loan.

Barclays, Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and RBC Capital Markets LLC are leading the credit facility.

Proceeds will be used to help fund the buyout of ADT Corp. by Apollo Funds for $42.00 per share in cash and merger with Protection 1, which is currently owned by Apollo. When combined with Protection 1, the aggregate transaction value is about $15 billion.

Protection 1 plans notes

Along with the credit facility, Protection 1 expects to get $3.14 billion second-priority senior secured notes due 2023, of which up to $1.89 billion are anticipated to be sold in a marketed private offering and at least $1.25 billion are expected to be sold to an affiliate of the sponsor and certain other investors in a private placement.

And, other funds for the transaction are expected to come from the issuance of $750 million of preferred securities to an affiliate of Koch Equity Development LLC, equity of $3,575,000,000, rollover equity of $906 million and cash on hand.

Closing is expected by June, subject to the conclusion of the applicable antitrust waiting periods in the United States and Canada, ADT stockholder approval and other customary conditions.

First-lien leverage is 2.3 times, and total leverage is 3.6 times, the source added.

Protection 1 is a full-service business and home security company. ADT is a Boca Raton, Fla.-based provider of monitored security, interactive home and business automation and related monitoring services.

Novolex readies loan

Novolex surfaced with plans to hold a conference call at 1:30 p.m. ET on Thursday to launch a $295 million incremental term loan (B1), a market source said.

Antares Capital and CPPIB are leading the loan that will be used with proceeds from privately placed subordinated debt to fund the acquisition of the Heritage Bag Co.

Novolex is a Hartsville, S.C.-based provider of paper and plastic flexible packaging products. Heritage is a Roanoke, Texas-based producer of institutional can liners.

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