Schaeffler, Affinion, Sterling break; Pinnacle Foods gains; Visant rises after earnings call

By Sara Rosenberg

New York, May 12 - Schaeffler, Affinion Group Inc. and Sterling Infosystems Inc. all freed up for trading on Monday, Pinnacle Foods Inc.'s term loans were stronger on news of an acquisition by the Hillshire Brands Co., and Visant Corp. was better after the company brought up refinancing potential in its earnings call.

Switching to the primary, Caesars Entertainment Operating Co. lowered the spread and tightened the original issue discount on its term loan B-7, Caesars Growth Properties Holdings LLC modified the offer price on its term loan, and UTEX Industries Inc. updated spreads and discounts on its first- and second-lien debt.

Also, Genex Holdings Inc. came out with price talk on its new deal with launch, Steinway Musical Instruments Inc. and One Call Medical Inc. released original issue discount guidance, and Liquidnet Holdings Inc., Zayo Group LLC and Compass Diversified Holdings joined this week's calendar.

Schaeffler hits secondary

Schaeffler's new bank debt broke for trading on Monday, with the $1.6 billion six-year term loan (Ba2/BB-) seen at par ¼ bid, par ¾ offered, according to a market source.

Pricing on the U.S. term loan, as well as on a €375 million six-year term loan (Ba2/BB-), is Libor/Euribor plus 300 basis points with a 0.75% floor and there is 101 soft call protection for six months. The U.S. tranche was sold at a discount of 99¾ and the euro loan was issued at par.

Recently, pricing on both term loans finalized at the tight end of the Libor/Euribor plus 300 bps to 325 bps talk and the offer price on the euro loan was tightened from 993/4.

Deutsche Bank Securities Inc., HSBC Securities, Barclays, BayernLB, BNP Paribas Securities Corp., Citigroup Global Markets Inc., Commerzbank, J.P. Morgan Securities LLC, LBBW and UniCredit are leading the deal, with Deutsche Bank the left lead on the U.S. piece and HSBC the left lead on the euro piece.

Proceeds will be used by the Herzogenaurach, Germany-based manufacturer of bearings for autos & industrial OEMs to refinance an existing €1.53 billion equivalent term loan C.

Affinion starts trading

Affinion Group's credit facility also freed up, with the $775 million first-lien term loan due April 2018 quoted at par ½ bid, 101 offered and the $425 million covenant-light second-lien term loan due October 2018 quoted at par ¾ bid, 101½ offered, a market source said.

Pricing on the first-lien term loan is Libor plus 525 bps with a 1.5% Libor floor and lenders were offered a 25 bps upfront fee. There is 101 soft call protection for one year.

The second-lien term loan is priced at Libor plus 700 bps with a 1.5% Libor floor and had a 25 bps upfront fee. This tranche is non-callable for two years, then at 102 in year three and 101 in year four.

The company's $1.28 billion credit facility also includes an $80 million revolver due January 2018.

During syndication, the first-lien term loan was upsized from $650 million, the second-lien term loan was downsized from $500 million and the revolver was downsized from $120 million.

Affinion amending, extending

Proceeds from Affinion's credit facility will be used to amend and extend an existing senior secured credit facility, including about $1.08 billion of term loan debt due October 2016.

Deutsche Bank Securities Inc. is leading the first-lien debt, and Deutsche Bank and Credit Suisse Securities (USA) LLC are leading the second-lien debt.

Affinion is a Norwalk, Conn.-based provider of marketing services and loyalty programs.

Sterling breaks

Sterling Infosystems' credit facility emerged in the secondary as well, with the $250 million seven-year covenant-light term loan quoted at par ¼ bid, par ¾ offered, a trader remarked.

Pricing on the term loan is Libor plus 450 bps with a 1% Libor floor and it was sold at a discount of 991/2. There is 101 soft call protection for one year.

During syndication, the term loan was downsized from $290 million, the spread was cut from revised talk of Libor plus 475 bps but it still came wide of initial talk of Libor plus 400 bps, the discount firmed at the low end of revised talk of 99 to 99½ but in line with initial talk of 991/2, and the call protection was extended from six months.

The company's $275 million credit facility (B2/B) also includes a $25 million six-year revolver.

GE Capital Markets, Deutsche Bank Securities Inc. and RBS Citizens are leading the deal that will repay debt and fund a distribution to shareholders, which was reduced by $40 million upon the term loan downsizing.

Sterling Infosystems, a New York-based provider of comprehensive employment and background screening services, is expected to close on the credit facility on Tuesday.

Pinnacle Foods strengthens

Also in trading, Pinnacle Foods' term loan G and term loan H moved up to par bid, par 3/8 offered from 99¼ bid, 99¾ offered after it was announced that Hillshire Brands is buying the company for about $6.6 billion, including the refinancing of all of Pinnacle's existing debt, a trader remarked. Another trader was quoting the term loans at par bid, par 1/16 offered, up from 99 3/8 bid, 99¾ offered.

Funds for the transaction, under which Pinnacle Foods common stock will be exchanged for $18.00 in cash and 0.50 shares of Hillshire Brands common stock, will come from $4.8 billion of new debt led by Goldman Sachs, $2.1 billion of equity and $100 million of cash on hand.

Pro forma for the acquisition, Hillshire's debt to EBITDA will be 5 times, including expected synergies.

Closing is expected by September, subject to shareholder and regulatory approvals and other customary conditions.

Pinnacle is a Parsippany, N.J.-based producer, marketer and distributor of branded food products.Hillshire is a Chicago-based convenient foods company.

Visant heads higher

Visant's term loan strengthened to 99 bid, 99¾ offered from 98 1/8 bid, 98 5/8 offered following the company's earnings call in which company officials said that the refinancing of its credit facility is being evaluated, according to a trader.

Officials remarked that the refinancing is currently a priority and that the company is now in the process of determining the next best steps.

For the first fiscal quarter, the company reported a net loss of $9.9 million, compared to a consolidated net loss of $14.9 million for the first fiscal quarter of 2013, net sales of $243.6 million, versus $244.9 million last year, and Adjusted EBITDA of $45.9 million, down from $48 million in the prior year.

At the end of March, leverage was 6.07 times, versus the credit agreement maximum allowable level of 6.75 times.

Visant is an Armonk, N.Y.-based marketing and publishing services enterprise servicing the school affinity, direct marketing, fragrance, cosmetic and personal care sampling and packaging, and educational and trade publishing segments.

Caesars Entertainment revised

Moving to the primary, Caesars Entertainment Operating trimmed pricing on its $1.75 billion incremental term loan B-7 (NA/CCC-/CCC) due March 1, 2017 to Libor plus 875 bps from Libor plus 950 bps and moved the original issue discount to 99¼ from 98, according to a market source.

As before, the term loan has a 1% Libor floor, and call protection of non-callable for six months, then at 101 for six months.

Recommitments were due at 5 p.m. ET on Monday, the source remarked.

Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc. and Macquarie Capital are leading the deal that will be used to refinance existing debt due in 2015 and existing term loans and for general corporate purposes.

Caesars Entertainment is a Las Vegas-based diversified casino-entertainment company.

Caesars Growth tweaks OID

Caesars Growth revised the discount on its $700 million one-year (with one-year extension option) first-lien term loan to 99¼ from 99 and asked for recommitments by 5 p.m. ET on Monday, a market source said.

The loan is still priced at Libor plus 600 bps for 30 days, stepping up to Libor plus 700 bps for the rest of year one and Libor plus 800 bps for year two, with a 1% Libor floor and provides for a % extension fee that is payable if the debt is outstanding at year two.

Credit Suisse Securities (USA) LLC is leading the deal that will be used by the Las Vegas-based casino asset and entertainment company to help fund the now completed acquisition of Bally's Las Vegas, the Cromwell and the Quad Resort & Casino from Caesars Entertainment Operating Co. Inc.

The company plans on completing its purchase of Harrah's New Orleans, following approval by the Louisiana Gaming Control Board, during the second quarter, and, at that time, it will use its already priced $675 million of notes and already syndicated $1,325,000,000 senior secured credit facility (B2/B+/BB-) to refinance the $700 million term loan and $485 million of debt outstanding for Planet Hollywood.

UTEX reworks deal

UTEX Industries trimmed pricing on its $475 million seven-year covenant-light first-lien term loan B (B2/B) to Libor plus 400 bps from Libor plus 425 bps, added s step-down to Libor plus 375 bps when net leverage is 5.5 times and the corporate rating is B3 with a stable outlook, changed the original issue discount to 99½ from 99 and extended the 101 soft call protection to one year from six months, according to a market source.

Additionally, pricing on the $200 million eight-year covenant-light second-lien term loan (Caa2/CCC+) was cut to Libor plus 725 bps from Libor plus 750 bps and the discount was revised to 99½ from 99, the source said.

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

UTEX getting revolver

Along with the term loans, UTEX's $725 million senior secured facility includes a $50 million five-year revolver (B2/B).

Bank of America Merrill Lynch, BNP Paribas Securities Corp., Societe Generale and UBS AG are leading the deal that will be used to refinance existing debt and fund a dividend.

UTEX is a Houston-based manufacturer of engineered sealing and other specialty products used in oil and gas drilling and production, power, mining, water treatment and other industrial sectors.

Genex discloses guidance

In more primary happenings, Genex Holdings held its bank meeting on Monday, and with the event, talk on its first- and second-lien term loans was announced, a market source said.

The $190 million first-lien term loan is talked at Libor plus 425 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, and the $90 million second-lien term loan is talked at Libor plus 775 bps with a 1% Libor floor, a discount of 99 and call protection of 102 in year one and 101 in year two, the source continued.

The company's $310 million senior secured credit facility also includes a $30 million revolver.

Commitments are due on May 22, the source added.

RBC Capital Markets, SunTrust Robinson Humphrey Inc. and UBS AG are leading the deal that will be used to help fund the buyout of the company by Apax Partners.

Genex is a Wayne, Pa.-based provider of integrated managed care services, focused on controlling health care costs and reducing disability expenses.

Steinway offer price

Steinway Musical Instruments launched with a call its $105 million add-on first-lien term loan (B2/B) with original issue discount guidance of 99, according to a market source.

The add-on, like the existing first-lien term loan, is priced at Libor plus 375 bps with a 1% Libor floor.

Commitments are due on May 19, the source said.

Bank of America Merrill Lynch and Deutsche Bank Securities Inc. are leading the deal that will be used to refinance an existing second-lien term loan.

Steinway is a Waltham, Mass.-based musical instruments company.

One Call OID talk

One Call Medical disclosed original issue discount talk of 99½ on its fungible $80 million add-on first-lien term loan B due Nov. 27, 2020 that launched with a call in the morning, a market source said.

The add-on pricing matches the existing loan at Libor plus 400 bps with a step-down to Libor plus 375 bps when net first-lien leverage is 4.25 times and a 1% Libor floor.

Bank of America Merrill Lynch, RBC Capital Markets, SunTrust Robinson Humphrey Inc. and UBS AG are leading the deal that will fund a bolt-on acquisition.

One Call is a Parsippany, N.J.-based provider of specialized cost containment services to the workers' compensation industry.

Liquidnet plans loan

Liquidnet Holdings set a call for 11 a.m. ET on Tuesday to launch a $175 million five-year term loan, according to a market source.

Jefferies Finance LLC is the leading the deal that will be used to refinance existing debt, fund the acquisition of bond trading platform, Vega-Chi, and to add cash to the balance sheet.

Closing on the acquisition is subject to regulatory approval.

Liquidnet is a New York-based institutional equities trading network.

Zayon coming soon

Zayo Group will hold a call at 2:30 p.m. ET on Tuesday to launch a fungible $275 million incremental term loan B due July 2, 2019, according to a market source.

Barclays, RBC Capital Markets and Morgan Stanley Senior Funding Inc. are leading the deal that will be used for general corporate purposes.

The company's existing roughly $1.74 billion term loan B is priced at Libor plus 300 bps with a 1% Libor floor, and has 101 soft call protection that expires on May 26.

Zayo is a Boulder, Colo.-based provider of fiber-based bandwidth infrastructure and network-neutral colocation and interconnection services.

Compass Diversified on deck

Compass Diversified Holdings scheduled a bank meeting for Wednesday to launch a $280 million seven-year term loan, according to a market source.

Bank of America Merrill Lynch and SunTrust Robinson Humphrey Inc. are leading the deal that will be used to refinance existing bank debt.

Compass Diversified is a Westport, Conn.-based owner and manager of middle-market businesses.

TravelClick closes

In other news, the $930 million buyout of TravelClick Inc. by Thoma Bravo LLC from Genstar Capital has been completed, a news release said.

For the transaction, TravelClick got a new $590 million credit facility that includes a $30 million revolver (B1/B-), a $395 million seven-year covenant-light first-lien term loan (B1/B-) and a $165 million 71/2-year covenant-light second-lien term loan (Caa2/CCC),

Pricing on the first-lien term loan is Libor plus 450 bps with a 1% Libor floor and it was sold at an original issue discount of 99. There is 101 soft call protection for one year.

The second-lien term loan is priced at Libor plus 775 bps with a 1% Libor floor and was sold at a discount of 981/2. This tranche has call protection of 103 in year one, 102 in year two and 101 in year three.

TravelClick lead banks

Credit Suisse Securities (USA) LLC, Bank of America Merrill Lynch and BMO Capital Markets led TravelClick's credit facility.

During syndication, the first-lien term loan was upsized from $385 million, pricing was lifted from talk of Libor plus 375 bps to 400 bps, the discount was changed from 99½ and the soft call was extended from six months.

Also, the second-lien loan was downsized from $175 million, pricing was increased from talk of Libor plus 700 bps to 725 bps, the discount was modified from 99 and the call protection was revised from 102 in year one and 101 in year two.

TravelClick is a New York-based provider of revenue-generating cloud-based services for the hospitality industry.

Jonah Energy wraps

Jonah Energy LLC closed on its acquisition of Encana Corp.'s interests in certain natural gas properties in the Jonah Field located in Sublette County, Wyo., for about $1.8 billion, according to a news release.

To help fund the transaction, Jonah Energy got a new $400 million senior secured covenant-light seven-year second-lien term loan (B3/B) priced at Libor plus 650 bps with a 1% Libor floor and sold at a discount of 981/2. There is call protection of 102 in year one and 101 in year two.

During syndication, pricing on the loan was increased from Libor plus 625 bps.

Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Bank of America Merrill Lynch, Wells Fargo Securities LLC, Morgan Stanley Senior Funding Inc. and Nomura led the deal.

Jonah Energy is a Denver-based company formed by TPG to acquire and operate the Jonah field operations and will also act as a platform to own and operate additional producing onshore oil & gas properties.

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