Drillships, AlixPartners, American Casino, Sapphire break; Triple Point, Genworth revised

By Sara Rosenberg

New York, July 2 - Drillships Financing Holding Inc. (Ocean Rig) shifted some funds between its term loan B-1 and B-2, firmed the discount on the B-1 loan at the wide end of revised talk, revised call protection on the tranche for a second time and then freed up for trading on Tuesday afternoon.

Also in the secondary, AlixPartners LLP, Water Pik Inc., American Casino & Entertainment Properties LLC and Sapphire Power Holdings broke, and Cengage Learning Acquisitions Inc.'s term loans saw the bid soften and the offer rise with news of a bankruptcy filing.

Back in the primary, Triple Point Group Holdings Inc. made a number of changes to its credit facility, including reducing the size of both term loans, widening spreads and original issue discounts and beefing up call premiums.

Furthermore, Genworth Wealth Management raised the coupon on its term loan, modified the discount and shortened the maturity, Gardner Denver Inc. and Media General Inc. came out with timing on their credit facilities, and Springer Science + Business Media joined the forward calendar, too.

Drillships revised again

Drillships lifted its seven-year and eight-month term loan B-1 to $975 million from $900 million, set the original issue discount at 98, the high side of the modified talk of 98 to 98½ and wide of initial talk of 99, and sweetened the call protection to 103 in year one, 102 in year two and 101 in year three from revised talk of 102 in year one and 101 in year two and original talk of 101 soft call protection for one year, sources said.

Pricing on the B-1 loan is Libor plus 500 basis points with a 1% Libor floor, after flexing earlier from the Libor plus 450 bps area.

With the B-1 upsizing, the company cut its three-year and two-month term loan B-2 to $825 million from $900 million, sources continued.

The B-2 loan is priced at Libor plus 450 bps with a 1% Libor floor and a discount of 99 and includes 101 soft call protection for one year.

Previously, the B-2 tranche saw pricing increased from the Libor plus 375 bps area and the discount widen from 991/2, and both term loans saw the addition of a net debt to EBITDA covenant, taking away their originally proposed covenant-light status.

Drillships starts trading

With final terms in place, Drillships' bank debt allocated and made its way into the secondary market on Tuesday, with the term loan B-1 quoted at 98½ bid and the term loan B-2 quoted at 99½ bid, a market source said.

Proceeds from the term loans will be used to refinance the existing secured bank debt at both Drillships Holdings Inc. and Drillships Investment Inc.

Deutsche Bank Securities Inc., Credit Suisse Securities (USA) LLC, Barclays and Goldman Sachs Bank USA are leading the $1.8 billion first-lien secured deal (B2/B+).

Parent company Ocean Rig is a Nicosia, Cyprus-based international offshore drilling contractor.

AlixPartners tops OIDs

AlixPartners' credit facility freed up for trading too, with the $95 million four-year first-lien term loan B-1 (B1) quoted at par bid, 101 offered, the $680 million seven-year term loan B-2 (B1) quoted at 99½ bid, par ¼ offered, and the $225 million second-lien term loan (Caa1) quoted at 99½ bid, a market source said.

The term loan B-1 is priced at Libor plus 325 bps with no Libor floor, and it was sold at an original issue discount of 991/2. This tranche is basically a roll of the company's existing $95 million term loan B-1. Existing lenders were offered 50 bps to roll over their positions.

Pricing on the B-2 loan is Libor plus 400 bps with a 1% Libor floor and it was sold at a discount of 99. There is 101 soft call protection for six months.

And, pricing on the second-lien loan is Libor plus 800 bps with a 1% Libor floor, and it was sold at 99. This tranche has call protection of 102 in year one and 101 in year two.

AlixPartners lead banks

Deutsche Bank Securities Inc., Bank of America Merrill Lynch, Goldman Sachs Bank USA, Jefferies Finance LLC and UBS Securities LLC are leading AlixPartners' new $1 billion credit facility.

During syndication, the B-2 loan was downsized to $655 million from $750 million when the B-1 was added to the capital structure and then upsized when the second-lien term loan was reduced from $250 million.

Also in the syndication process, the term B-2 saw its spread finalize at the high end of the Libor plus 375 bps to 400 bps talk and its discount firm at the high end of the 99 to 99½ talk, and the second-lien loan saw pricing come at the wide side of the Libor plus 775 bps to 800 bps guidance.

Proceeds will be used for a recapitalization.

First-lien leverage is 4.5 times and total leverage is 5.7 times.

AlixPartners is a New York-based performance improvement, corporate turnaround and financial advisory services firm.

Water Pik hits secondary

Water Pik's credit facility also broke, with the $215 million seven-year first-lien covenant-light term loan (B2/B) seen at 98¼ bid, 98¾ offered, and the $95 million 71/2-year second-lien covenant-light term loan (Caa2/CCC+) seen at 96¾ bid, 97¼ offered, according to a market source.

Pricing on the first-lien loan is Libor plus 475 bps with a 1% Libor floor and it was sold at a discount of 98. There is 101 repricing protection for one year.

The second-lien loan is priced at Libor plus 875 bps with a 1% floor and was sold at 961/2. This debt is non-callable for one year, then at 103 in year two, 102 in year three and 101 in year four.

Last week, Water Pik lifted pricing on the first-lien loan from Libor plus 400 bps, revised the discount from 99 and extended the call protection from six months, and pricing on the second-lien loan was increased from Libor plus 800 bps, the discount moved from 98½ and the call protection was sweetened from 102 in year one and 101 in year two.

Water Pik funding buyout

Water Pik's $335 million credit facility, which also includes a $25 million revolver (B2/B), will be used to help fund its purchase by MidOcean Partners LP.

Credit Suisse Securities (USA) LLC, GE Antares and Macquarie Capital are leading the deal.

Water Pik is a Fort Collins, Colo.-based provider of branded oral health and replacement showerhead products.

American Casino breaks

Another deal to begin trading was American Casino, with its $215 million six-year first-lien term loan (B1/BB) quoted at 99½ bid and its $120 million 61/2-year second-lien term loan (Caa2/B-) quoted at 97½ bid, a source remarked.

The first-lien loan is priced at Libor plus 475 bps with a 1.25% Libor floor and it was sold at an original issue discount of 99. There is 101 soft call protection for one year.

As for the second-lien loan, it is priced at Libor plus 1,000 bps with a 1.25% Libor floor and it was sold at 97. The debt is non-callable for two years, then at 103 in year three and 101 in year four.

Recently, the spread on the first-lien loan was increased from Libor plus 425 bps and the maturity was shortened from seven years, and pricing on the second-lien loan was lifted from talk of Libor plus 825 bps to 850 bps, the discount was modified from 98, the maturity was shortened from 7½ years, and the call protection was changed from non-callable for one year, then at 102 in year two and 101 in year three.

American Casino to redeem notes

Proceeds from American Casino's $350 million credit facility, which also provides for a $15 million revolver (B1/BB), will fund a tender offer that expires on Friday for $337.5 million of 11% senior secured notes due 2014.

Goldman Sachs Bank USA and Deutsche Bank Securities Inc. are leading the deal.

American Casino is a Las Vegas-based owner and operator of gaming and entertainment properties.

Sapphire frees up

Sapphire Power's credit facility hit the secondary as well, with the $250 million five-year term loan quoted at 99½ bid, par ½ offered, according to a market source.

Pricing on the loan is Libor plus 500 bps with a 1% Libor floor and it was sold at an original issue discount of 99. There is call protection of 102 in year one and 101 in year two.

During syndication, the term loan was downsized from $350 million, pricing firmed at the low end of the revised Libor plus 500 bps to 525 bps talk but wide of original talk of Libor plus 400 bps, the call protection was changed from 101 soft call for one year, the maturity was shortened from seven years, and net leverage and interest coverage ratios were added to the originally covenant-light deal.

The Austin, Texas-based power company's $280 million credit facility (B1/B+) also includes a $30 million revolver that is pari passu with the term loan, revised earlier from super-priority status.

Goldman Sachs Bank USA and Deutsche Bank Securities Inc. are leading the deal that will be used to refinance existing debt, to fund a debt service reserve account and fund a dividend payment, the size of which was reduced due to the term loan downsizing.

Cengage widens

In more trading happenings, Cengage's term loans saw levels widen out as the company announced a Chapter 11 filing, according to a trader.

The extended term loan, non-extended term loan and incremental term loan were all quoted at 73½ bid, 76½ offered, compared to 74 bid, 75 offered on Monday, the trader remarked.

In conjunction with the bankruptcy filing, the company entered into a restructuring support agreement with an ad hoc committee of first-lien lenders who hold about $2 billion of its first-lien debt.

The restructuring is expected to eliminate more than $4 billion in debt from the balance sheet and position the company to implement management's strategic business plan.

The company is not planning on getting a debtor-in-possession financing facility as it maintains substantial cash balances and expects to generate positive cash flow, a news release said. Secured lenders have agreed to let the company use its use cash flow from operations to continue to fund the business and meet obligations in the normal course during the restructuring process.

Cengage is a Stamford, Conn.-based educational content, software and services company.

Triple Point reworked

Returning to the new deal front, Triple Point Group downsized its seven-year first-lien covenant-light term loan to $310 million from $320 million, raised pricing to Libor plus 425 bps from talk of Libor plus 375 bps to 400 bps, widened the discount to 96 from 99 and extended the 101 soft call protection to one year from six months, according to a market source.

Additionally, the company trimmed its eight-year second-lien covenant-light term loan to $125 million from $165 million, lifted the spread to Libor plus 825 bps from talk of Libor plus 775 bps to 800 bps, moved the discount to 95 from 981/2, and revised the call protection to 103 in year one, 102 in year two and 101 in year three, from 102 in year one and 101 in year two, the source said.

Unchanged on both term loans was the 1% Libor floor.

Triple Point revolver

Triple Point's now $475 million credit facility, for which recommitments are due at 5 p.m. ET on July 9, also includes a $40 million revolver.

Credit Suisse Securities (USA) LLC is leading the deal that will be used to help fund the buyout of the company by Ion Investment Group.

As a result of the change to the term loan sizes, Ion is investing $50 million more in cash equity. The total equity check is now $416 million, which is 49% of total capitalization, the source remarked.

Triple Point is a Westport, Conn.-based provider of software for end-to-end commodity management.

Genworth flexes up

Genworth Wealth Management raised pricing on its $230 million first-lien term loan to Libor plus 550 bps from Libor plus 475 bps, moved the discount to 98 from 99 and changed the maturity to July 1, 2019 from 2020, according to a market source.

The term loan still has a 1% Libor floor and 101 soft call protection for one year.

The company's $255 million credit facility (B2/B), which also includes a $25 million five-year revolver, is expected to allocate next week, the source said.

Credit Suisse Securities (USA) LLC is leading the deal that will help fund the $412.5 million buyout of the company by Genstar Capital LLC and Aquiline Capital Partners LLC from Genworth Financial Inc.

Genworth is a Richmond, Va.-based product provider in the wealth management industry.

Gardner timing emerges

Gardner Denver set timing on the launch of its $2,725,000,000 senior secured credit facility, with a bank meeting scheduled to take place at 10:30 a.m. ET in New York on July 9 and in London on July 11, a market source said.

As previously reported, the facility consists of a $400 million five-year revolver, a $1.8 billion seven-year term loan and a $525 million seven-year euro term loan.

UBS Securities LLC, Barclays, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Mizuho Corporate Bank Ltd., RBC Capital Markets, Macquarie Capital And HSBC Securities (USA) Inc. are the bookrunners on the deal and the joint lead arrangers with KKR Capital Markets and Sumitomo Mitsui Banking.

Gardner being acquired

Proceeds from Gardner Denver's credit facility, along with $675 million of senior notes, will help fund its buyout by Kohlberg Kravis Roberts & Co. LP for $76 per share in cash. The transaction is valued at about $3.9 billion, including the assumption of debt.

Closing is expected in the third quarter, subject to shareholder approval, regulatory approvals and other customary conditions.

Gardner Denver is a Wayne, Pa.-based manufacturer of industrial compressors, blowers, pumps, loading arms and fuel systems.

Media General on deck

Media General emerged with plans to hold a bank meeting on July 10 to launch its $900 million credit facility, according to a market source.

RBC Capital Markets, J.P. Morgan Securities LLC and Wells Fargo Securities LLC are leading the deal that is being done in connection with the company's all-stock merger with New Young Broadcasting Holding Co. Inc., a Nashville, Tenn.-based media company.

Proceeds will be used to refinance around $765 million of debt at Media General and Young and pay a $50 million cash contribution to Media General's qualified pension plan.

Under the agreement, Media General will reclassify each outstanding share of its class A and class B common stock into one share of a newly created class of Media General common stock. Then, 60.2 million shares of the new Media General common stock will be issued to Young's shareholders.

Closing is expected late in the third or early in the fourth quarter, subject to Media General shareholder approval, Federal Communications Commission approval, clearance under the Hart-Scott-Rodino antitrust act and customary third-party consents.

Media General is a Richmond, Va.-based provider of news, information and entertainment.

Springer readies deal

Springer Science + Business Media set a bank meeting for 11 a.m. ET in New York on July 9 to launch a €1.92 billion credit facility that includes a a €150 million revolver and a €1.77 billion seven-year covenant-light term loan, of which about €1.205 billion will be marketed to U.S. investors, according to sources.

Credit Suisse, Goldman Sachs, J.P. Morgan, Barclays, Nomura and UBS are leading the transaction.

Proceeds, along with €640 million of subordinated debt that has been privately placed with Goldman Sachs Mezzanine fund, will be used to fund the buyout of the company by BC Partners from EQT Partners and the Government of Singapore Investment Corp. for around €3.3 billion.

Senior leverage is about 5 times and total leverage is just shy of 7 times, sources added.

Springer is a Berlin-based STM publisher that provides scientific, professional and academic media content.

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