SBA, Block Communications, Pregis break; Hyland Software, Dollar Tree, Lindblad tweak deals

By Sara Rosenberg

New York, June 8 – SBA Senior Finance II, Block Communications Inc. and Pregis Corp. NA firmed pricing terms on their new deals, and then all three companies saw their debt free up for trading on Monday.

In other happenings, Hyland Software Inc. moved some funds between its first- and second-lien term loans, tightened the spread and issue price on the second-lien debt and added a leverage-based pricing step-down to the first-lien debt.

Also, Dollar Tree Inc. downsized its term loan B while setting the issue price at the tight end of talk and upsizing its fixed-rate loan, and Lindblad Expeditions Inc. came out with modified price talk on its term loan at its bank meeting.

Furthermore, Cengage Learning Acquisitions Inc. and Mauser Group released talk with launch, and Cirque du Soleil, Jack’s Family Restaurants, Alliance HealthCare Services Inc., Ravn Alaska and Kendra Scott Designs joined this week’s new-deal calendar.

SBA firms OID, trades

SBA Senior Finance set the original issue discount on its $500 million seven-year incremental senior secured term loan B (BB) at 99, the wide end of the 99 to 99.5 talk, and left pricing at Libor plus 250 basis points with a 0.75% Libor floor, according to a market source. The 101 soft call protection for six months was also unchanged.

With final terms in place, the term loan made its way into the secondary market on Monday. The debt was quoted at 99 1/8 bid, 99 5/8 offered on the break and then moved up to 99¼ bid, 99¾ offered, a trader remarked.

Citigroup Global Markets Inc., Barclays, Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Mizuho Securities USA Inc., TD Securities (USA) LLC and Wells Fargo Securities LLC are leading the deal that will be used to repay the drawn amount under the company’s revolver.

Closing is expected on Wednesday.

SBA Senior Finance is a subsidiary of SBA Communications Corp., a Boca Raton, Fla.-based owner and operator of wireless communications infrastructure.

Block sets spread, breaks

Block Communications firmed pricing on its roughly $224 million term loan B at Libor plus 325 bps, the high end of the Libor plus 300 bps to 325 bps talk, and left the 0.75% Libor floor, par issue price and 101 soft call protection for six months intact, a market source said.

The loan freed up for trading in the afternoon, with levels quoted at par ¼ bid, par ¾ offered, a trader added.

Bank of America Merrill Lynch and JPMorgan are leading the deal that will be used to reprice an existing term loan B from Libor plus 350 bps with a 0.75% Libor floor.

Block Communications is a Toledo, Ohio-based diversified media company.

Pregis finalizes, frees up

Pregis set the spread on its $57 million add-on first-lien term loan and repricing of its existing roughly $227 million first-lien term loan at Libor plus 350 bps, the low end of the Libor plus 350 bps to 375 bps talk, and revised the original issue discount on the add-on loan to 99.75 from 99.5, according to a market source.

The repricing issue price remained at par, and all of the first-lien term loan debt still has a 1% Libor floor and 101 soft call protection for six months.

Recommitments were due at 1 p.m. ET on Monday, and by late afternoon, the first-lien term debt hit the secondary market at levels of par bid, par ½ offered, a trader added.

Goldman Sachs Bank USA and Barclays are leading the deal (B3) for the Deerfield, Ill.-based protective packaging materials and systems manufacturer.

Proceeds from the add-on loan will be used to repay some second-lien debt and for acquisition financing, and the repricing will take the existing term loan down from Libor plus 400 bps with a 1% Libor floor.

Hyland restructures

Hyland Software increased its seven-year first-lien covenant-light term loan (B2/B) to $625 million from $600 million and added a 25 bps pricing step-down tied to a net first-lien leverage test, according to market sources.

The first-lien term loan is still priced at Libor plus 375 bps with a 1% Libor floor and an original issue discount of 99.5, and still has 101 soft call protection for six months. Prior to the late-May bank meeting for the deal, the discount on the first-lien term loan was being guided at 99.75, but the debt ended up being launched at the 99.5 level.

Regarding the eight-year second-lien covenant-light term loan (Caa2/CCC+), the tranche was reduced to $155 million from $180 million, pricing was lowered to Libor plus 725 bps from Libor plus 750 bps and the discount was revised to 99.5 from 99, sources remarked.

As before, the second-lien term loan has a 1% Libor floor and call protection of 102 in year one and 101 in year two.

Hyland getting revolver

In addition to the first- and second-lien term loans, Hyland’s $820 million credit facility includes a $40 million revolver (B2/B).

Commitments were due at 5 p.m. ET on Monday, moved up from Wednesday, sources added.

Credit Suisse Securities (USA) LLC and Goldman Sachs Bank USA are leading the deal that will be used to fund the acquisition and recapitalization of the company by Thoma Bravo Equity Fund XI. Thoma Bravo, the current owner of Hyland, is basically selling the company from one fund to another.

Hyland is a Westlake, Ohio-based enterprise content-management software developer.

Dollar Tree reworked

Dollar Tree reduced its seven-year term loan B to $3.3 billion from $3.45 billion and firmed the issue price at par, the tight end of the 99.75 to par talk, a source said.

Pricing on the term loan B remained at Libor plus 275 bps with a 0.75% Libor floor, and there is still 101 soft call protection for one year.

Meanwhile, the fixed-rate loan was lifted to $650 million from $500 million, the source continued.

As before, the fixed-rate loan is priced at 4.25% and is non-callable for one year, then at 102 in year two and 101 in year three.

JPMorgan and Wells Fargo Securities are leading the deal that will be used to reprice/refinance a $3.95 billion term loan B priced at Libor plus 350 bps with a 0.75% Libor floor.

Dollar Tree is a Chesapeake, Va.-based discount store operator.

Lindblad adjusts talk

Lindblad Expeditions went out at its bank meeting on Monday with revised price talk of Libor plus 500 bps on its $150 million seven-year first-lien term loan (B2/BB+), according to a market source.

Prior to the meeting, the loan was guided at Libor plus 550 bps, but talk tightened due to strong early demand for the debt and the receipt of a 1 recovery rating from Standard & Poor’s, the source said.

As before, the loan is also talked with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months.

Commitments are due at 5 p.m. ET on June 23.

Credit Suisse Securities is leading the deal that will be used to help fund the acquisition of the company by Capitol Acquisition Corp. II for about $439 million.

Lindblad Expeditions is a New York-based expedition cruising and extraordinary adventure travel company.

Cengage holds call

Also on the primary front, Cengage emerged in the morning with plans to hold a lender call at 4 p.m. ET on Monday to launch a repricing of its $2,031,000,000 first-lien covenant-light term loan due March 31, 2020 at talk of Libor plus 450 bps to 475 bps with a 1% Libor floor, a par issue price and 101 soft call protection for six months, a source said.

The repricing will take the first-lien term loan down from Libor plus 600 bps with a 1% Libor floor.

Commitments are due at noon ET on Friday, the source added.

Credit Suisse Securities is leading the deal.

Cengage is a Stamford, Conn.-based provider of teaching, learning and research services for the academic, professional and library markets.

Mauser comes to market

Mauser Group held a lender call at 11 a.m. ET, launching an €89 million U.S. dollar-equivalent add-on first-lien covenant-light term loan due 2021 that is talked at Libor plus 350 bps with a 1% Libor floor, in line with current first-lien term loan pricing, and an original issue discount of 99 to 99.5, according to a market source.

All of the first-lien term loan debt will have 101 soft call protection for one year.

Proceeds from the add-on loan will be used to fund a shareholder dividend.

Credit Suisse Securities and Nomura are leading the deal for the Bruehl, Germany-based industrial packaging company.

Mauser amending

Along with the add-on, Mauser launched an amendment to its existing first- and second-lien covenant-light term loans to allow for the dividend.

As part of the amendment, the spread on the existing second-lien term loan due 2022 will be raised to Libor plus 775 bps from Libor plus 725 bps while the 1% Libor floor will be unchanged.

The second-lien term loan will have call protection of 102 in year one and 101 in year two, with a 101 initial public offering carve-out.

First-lien lenders are being offered a 15 bps amendment fee, and second-lien lenders are being offered a 75 bps amendment fee.

Commitments are due at noon ET on Friday, the source added.

Cirque du Soleil on deck

Cirque du Soleil set a bank meeting for 10:30 a.m. ET on Wednesday to launch an $885 million credit facility, according to market sources.

The facility consists of a $100 million revolver, a $615 million seven-year first-lien covenant-light term loan and a $170 million eight-year second-lien covenant-light term loan, sources said. Price talk is not yet available.

Commitments are due on June 24.

Deutsche Bank Securities, Bank of America Merrill Lynch, RBC Capital Markets, UBS AG, BMO Capital Markets, National Bank of Canada, Scotiabank and TD Securities are leading the deal, with Deutsche left on the first-lien and Bank of America left on the second-lien.

Proceeds will be used to help fund the buyout of the company by TPG and Fosun Capital. Caisse de depot et placement du Quebec will also acquire a minority interest in the company.

Cirque, a Montreal-based producer of live artistic entertainment, expects the buyout to close in the third quarter, subject to customary conditions.

Jack’s joins calendar

Jack’s Family Restaurants scheduled a bank meeting for June 16 to launch a $260 million credit facility, a market source remarked.

The facility consists of a $30 million revolver and a $230 million first-lien term loan, the source added.

Commitments are due on June 30.

RBC Capital Markets and Morgan Stanley Senior Funding Inc. are leading the deal that will be used to help fund the buyout of the company by Onex Corp.

Leverage will be 4.1 times.

Jack’s is a Homewood, Ala.-based quick-service restaurant operator.

Alliance readies loan

Alliance HealthCare Services will hold a lender call at 11 a.m. ET on Tuesday to launch a $30 million incremental first-lien term loan due June 3, 2019 that is talked at Libor plus 325 bps with a 1% Libor floor and an original issue discount of 99.5, according to a market source.

The incremental loan is expected to be fungible with the company’s existing $477 million first-lien term loan that is priced at Libor plus 325 bps with a 1% Libor floor.

Commitments are due on June 16, the source said.

Credit Suisse Securities is leading the deal.

Proceeds will be used to repay revolver borrowings and add cash to the balance sheet.

Alliance HealthCare is a Newport Beach, Calif.-based provider of advanced outpatient diagnostic imaging and radiation therapy service.

Ravn coming soon

Ravn Alaska scheduled a bank meeting for Tuesday to launch a $110 million credit facility that consists of a $15 million five-year revolver and a $95 million six-year term loan, a source remarked.

BNP Paribas Securities Corp. and Keybanc Capital Markets are leading the deal.

Proceeds will be used to help fund the buyout of the Anchorage-based airline company by J.F. Lehman & Co.

Kendra Scott readies deal

Kendra Scott Designs plans to hold a bank meeting on Thursday to launch an $85 million credit facility, according to a market source.

The facility consists of a $15 million five-year revolver and a $70 million six-year term loan, the source said.

BNP Paribas Securities is leading the deal that will be used to refinance existing debt and fund a dividend.

Kendra Scott is an Austin, Texas-based jewelry and accessories company.

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