Targa, BCBG Max Azria, San Juan Cable break for trading; RGIS ups second-lien spread

By Sara Rosenberg

New York, Oct. 28 - Targa Resources Inc. allocated its credit facility on Friday, with the term loan B opening for trading in the low-to-mid par context. BCBG Max Azria Group also allocated its credit facility, after finalizing pricing, with its term loan seeing trading in the low-to-mid par area. And, San Juan Cable LLC freed up for trading as well, with its first-lien term loan quoted anywhere from the upper-pars to atop 101.

In primary doings, RGIS Inventory Specialists increased pricing on its second-lien term loan by a whopping 100 basis points.

Targa's credit facility freed up for trading early in the day Friday, with the $1.25 billion seven-year term loan B breaking at par ¼ bid, par ½ offered, settling down to the par bid, par ¼ offered context by midday, and then moving back up to par 3/8 bid, par 5/8 offered by close, according to various traders.

The term loan B is priced with an interest rate of Libor plus 225 basis points and has a step down to Libor plus 200 basis points upon the sale of the company's North Texas asset. During syndication, the tranche had been upsized from $1.15 billion after company downsized its bond offering by $100 million to $250 million. In addition, pricing on the B loan came down from original price talk of Libor plus 250 basis points on strong investor demand.

Targa's $2.4 billion credit facility (Ba3/B+) also contains a $300 million six-year synthetic letter-of-credit facility with an interest rate of Libor plus 225 basis points - after also being reverse flexed from original price talk of Libor plus 250 basis points - a $250 million six-year revolver with an interest rate of Libor plus 225 basis points and a $700 million two-year asset sale term loan with an interest rate of Libor plus 225 basis points.

Credit Suisse First Boston, Merrill Lynch and Goldman Sachs are the lead banks on the deal, with CSFB the left lead.

Proceeds from the loan and the bonds will be used to help fund Targa's acquisition of Dynegy Inc.'s Midstream natural gas business for $2.35 billion.

The Midstream business, once acquired, will continue to be based in Houston and will be combined with Targa's Louisiana and Texas assets.

Completion of the acquisition, which is expected to take place in the fourth quarter, is conditioned on the expiration or termination of the Hart-Scott-Rodino waiting period and the fulfillment of other customary closing conditions.

Targa is an independent midstream energy company formed in 2003 by management and the global private equity firm Warburg Pincus.

BCBG breaks atop par

BCBG Max Azria allocated its credit facility during Friday's session after firming up pricing, with the $200 million six-year term loan B freeing up for trading at par ¼ bid for $2 million, par ½ offered for $2 million, and then widening out slightly to par ¼ bid for $2 million, par 5/8 offered for $2 million, according to a buyside source.

Pricing on the term loan was finalized at Libor plus 325 basis points - right in the middle of original price talk of Libor plus 300 to 350 basis points, the source said. Some investors had basically expected that pricing would fall out at the midpoint of talk as the Libor plus 350 basis points spread was pretty much ruled out after ratings came in a little better than expected at B1/B+ and the Libor plus 300 basis points spread was pretty much ruled out as being a little too cheap.

As for term loan allocations, "we did well on our allocation, not sure about others though," the buyside source added.

BCBG's $300 million credit facility also contains a $100 million five-year asset-based revolver (Ba3/BB).

Goldman Sachs and Citigroup are the lead banks on the deal, with Goldman the left lead on the term loan and Citi the left lead on the revolver.

Security for revolver borrowings is a first lien on accounts receivables and inventory.

Security for term loan borrowings is a first lien on capital stock and property, plant and equipment and a second lien on accounts receivables and inventory.

Proceeds will be used by the Vernon, Calif., clothing company to refinance existing debt and for acquisition consideration.

San Juan Cable in high pars

San Juan Cable's credit facility also hit the secondary loan market on Friday, with its $225 million first-lien term loan (B1) quoted at par ¾ bid, 101 offered at the end of the session, according to one trader. However, earlier in the session the paper was quoted as high as 101¼ bid, 101¾ offered, according to a second trader who actually put the paper closer to the 101 bid, 101½ offered area by the end of the day.

In addition, the company's $125 million second-lien term loan (B2) was quoted at par bid, 101 offered during market hours, the second trader added.

The first-lien term loan is priced with an interest rate of Libor plus 200 basis points. During syndication, the tranche was upsized from $190 million and pricing was reverse flexed from original price talk at launch of Libor plus 225 basis points.

The second-lien term loan is priced with an interest rate of Libor plus 550 basis points. During syndication, the second-lien tranche was reduced from a size of $160 million when the first-lien term loan was upsized.

San Juan Cable's $400 million credit facility also contains a $50 million revolver (B1).

Citigroup and JPMorgan are the lead banks on the deal.

Proceeds from the loan will be used to help fund MidOcean Partners' and Crestview Partners' acquisition of San Juan Puerto Rico area cable operations jointly owned by Adelphia Communications Corp. and ML Media Partners LP.

Under the terms of the transaction that was announced in June, MidOcean and Crestview will pay $520 million for the assets subject to customary purchase price adjustments, which equates to an approximately $3,800-per-subscriber valuation.

F&W holds steady

F&W Publications Inc.'s first-lien term loan pretty much held steady after the company held a private lender call on Friday, with levels quoted wide at 94 bid, 97 offered, according to a trader.

On Thursday, the first-lien bank debt gave up about 4 points as rumors circulated that the company may have some problem with the way inventory has been accounted for and could potentially be facing covenant non-compliance.

F&W is a Cincinnati-based publisher of special interest magazines and books.

RGIS second lien flexes up

RGIS Inventory Specialists significantly amplified pricing on its $150 million second-lien term loan (B3/B-) to Libor plus 700 basis points from original price talk at launch of Libor plus 600 basis points, according to a market source.

Pricing on the company's $70 million revolver (B2/B+) and $350 million first-lien term loan B (B2/B+) remained at Libor plus 250 basis points, the source said.

JPMorgan is the lead bank on the $570 million credit facility that will be used to pay a dividend to shareholders.

RGIS is an Auburn Hills, Mich., third-party inventory taker.

Penhall firms pricing

Penhall International Corp. finalized pricing on its $105 million second-lien term loan at Libor plus 675 basis points - right in the middle of original price talk of Libor plus 650 to 700 basis points, according to a market source.

The $160 million credit facility also contains a $55 million revolver with an interest rate of Libor plus 250 basis points.

Deutsche is the lead bank on the deal that will be used to refinance existing debt and for general corporate purposes.

Penhall is an Anaheim, Calif., specialized concrete cutting and demolition company.

American Tower closes

American Tower Corp. closed on its $2.45 billion all pro-rata credit facilities, which is divided into a $1.3 billion credit facility for American Tower and a $1.15 billion credit facility for SpectraSite Inc.

TD Securities and JPMorgan acted as joint lead arrangers on the deals, with TD the left lead on SpectraSite facility and JPMorgan the left lead on the American Tower facility. TD is also the administrative agent for both facilities.

The American Tower five-year facility (Baa3/BBB/BBB-) consists of a $750 million term loan A, a $250 million delayed-draw term loan A with one-year availability, and a $300 million revolver. All tranches are priced with an interest rate of Libor plus 75 basis points.

The SpectraSite five-year facility (Ba1/BBB/BBB-) consists of a $700 million term loan A, a $200 million delayed-draw term loan A with one-year availability, and a $250 million revolver. All of these tranches are priced with an interest rate of Libor plus 75 basis points as well.

Proceeds were used to refinance the existing $1.1 billion senior secured credit facility at the American Tower operating company level and the $900 million senior secured credit facility at the SpectraSite operating company level. Proceeds will also be available for general corporate purposes.

At closing, the company drew down both the American Tower and the SpectraSite delayed-draw term loan As and used the net proceeds to repay the principal and interest on the $745 million outstanding under the previous American Tower credit facility and the principal and interest on the $697 million outstanding under the previous SpectraSite facility.

In August, Boston-based American Tower completed its merger with SpectraSite, creating a combined company with a portfolio of more than 22,000 owned communications sites, including more than 21,500 wireless towers, more than 400 broadcast towers and nearly 100 in-building sites.

Abengoa closes

Abengoa Bioenergy of Ravenna (Nordic Biofuels of Ravenna LLC) closed on its new $122 million credit facility consisting of an $80 million 71/2-year first-lien term loan B (B2/B) with an interest rate of Libor plus 425 basis points and a $42 million eight-year second-lien term loan with an interest rate of Libor plus 750 basis points.

During syndication, the first-lien term loan was cut from an original size of $120 million, tenor was decreased from eight years and pricing was flexed up from original price talk of Libor plus 325 to 350 basis points.

In addition, the second-lien term loan was added to the credit structure, increasing the overall credit facility size to $122 million from $120 million.

Credit Suisse First Boston is the lead bank on the deal that is being used to build a greenfield ethanol plant in Ravenna, Neb.

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