Infogroup moves deadline; Del Taco, USIC tweak deals; Protection One, Sedgwick set launches

By Sara Rosenberg

New York, May 7 - Infogroup Inc. announced on Friday that it accelerated the commitment deadline on its credit facility, Del Taco LLC (Sagittarius Restaurants LLC) sweetened pricing and the discount on its term loan largely because of ratings, and United States Infrastructure Corp. (USIC) lowered pricing on its deal.

Also, Protection One Inc. came out with timing on its buyout credit facility, and Sedgwick Claims Management Services Inc. not only released timing but size and structure as well on its upcoming deal.

In addition, price talk on Southern Wine & Spirits of America Inc. and Dave & Buster's Inc. surfaced, and Multi Packaging Solutions Inc. is hoping to allocate its credit facility shortly as the document review process is close to wrapping up.

Meanwhile in the secondary market, which continued to feel heavy, Warner Chilcott plc's bank debt was a little softer after earnings were announced, and HCA Inc.'s term loans were unchanged to lower on the back of numbers and initial public offering news.

Infogroup revises deadline

Infogroup moved up the commitment deadline for its $315 million term loan to the end of day on Friday from Tuesday since the deal is oversubscribed, according to sources.

The term loan is still being talked at Libor plus 425 basis points to 450 bps with a 1.5% to 1.75% Libor floor and an original issue discount in the 98½ area.

The company's $365 million senior secured credit facility (B1/BB-) also includes a $50 million revolver.

Bank of America is the lead bank on the deal.

Infogroup being acquired

Proceeds from Infogroup's credit facility will be used to help fund the buyout of the company by CCMP Capital Advisors LLC for $8.00 in cash per share. The transaction has a total value of about $635 million, including the refinancing of its outstanding debt.

Equity for the transaction will be $343.7 million.

Closing is anticipated in early summer, subject to the approval of Infogroup shareholders, regulatory approvals and customary closing conditions.

Infogroup is an Omaha, Neb.-based provider of data-driven and interactive resources for targeted sales, marketing and research services.

Del Taco revises pricing

Del Taco came out with some changes to pricing on its $160 million term loan, including increasing the spread to Libor plus 550 bps from Libor plus 450 bps, according to a market source.

Also, the original issue discount was widened to 97½ from the initial 98 to 99 talk, but the 2% Libor floor was left intact, the source said.

And, call protection of 102 in year one and 101 in year two was added to the loan.

The change in pricing had something to do with ratings that the company recently received.

"Caa1 corporate is difficult for a number of investors, but the book is building again," the source explained.

Currently, Moody's Investors Service's corporate rating for Del Taco is Caa2, but it is expected to be upgraded to Caa1 following completion of the transaction.

Del Taco refinancing debt

Del Taco, a Lake Forest, Calif., operator and franchiser of restaurants, will use the new credit facility to refinance existing debt.

Wells Fargo is the left lead bank on the $195 million five-year credit facility (B1/B), which also includes a $35 million revolver, and GE Capital signed on as a co-lead.

Prior to launch, the facility was expected to be sized at $190 million, comprised of a $40 million revolver and a $150 million term loan. However, at the bank meeting, lenders were presented with the current structure.

USIC cuts spread

United States Infrastructure reverse flexed pricing on its $158.5 million five-year credit facility to Libor plus 400 bps from Libor plus 425 bps, and reduced the original issue discount on the term loan to 99 from 981/2, according to a market source.

Left unchanged was the 1.5% Libor floor that the entire facility carries and the 98½ original issue discount on the revolver.

Tranching on the deal is comprised of a $45 million revolver and a $113.5 million term loan.

GE Capital and BNP Paribas are the lead banks on the facility that will be used to help fund the buyout of the company by Omers from Kohlberg & Co.

United States Infrastructure is a Carmel, Ind.-based provider of utility infrastructure locating services.

Protection One schedules launch

Protection One has set a bank meeting for Tuesday to launch its proposed $415 million senior secured credit facility, according to a market source.

The facility consists of a $390 million six-year term loan and a $25 million five-year revolver, and, based on a SC TO-T that was recently filed with the Securities and Exchange Commission, both tranches are expected to be priced at Libor plus 400 bps with a 1.75% Libor floor if the corporate family rating is B2/B or better, and Libor plus 475 bps with a 2% Libor floor if the rating is lower.

The original issue discount on the term loan is expected at 99 at B2/B ratings and at 98½ at lower ratings, and the upfront fee on the revolver is expected at 98½ at B2/B ratings, and at 98 at lower ratings, the filing said.

The revolver has a 75 bps commitment fee.

Protection One getting mez financing

In connection with the new credit facility, Protection One will also be getting $150 million of senior subordinated notes priced at 12.5% in cash plus 1% PIK that TCW/Crescent Mezzanine has committed to purchase.

Proceeds from the bank debt, which is being led by JPMorgan and Barclays, the mezzanine financing and $340 million in equity will be used to fund the buyout of the company by GTCR for $15.50 per share.

The total purchase price, including the refinancing of Protection One's debt, is roughly $828 million.

Closing is expected in the second quarter, subject to minimum levels of participation in the tender offer and regulatory approvals.

Protection One is a Lawrence, Kan.-based provider of electronic security services to the residential, commercial and wholesale markets.

Sedgwick Claims coming Tuesday

Sedgwick Claims Management Services is planning a bank meeting on Tuesday morning to launch its credit facility, and now that timing is set, it was revealed that the deal is sized at $660 million, according to market sources.

Tranching on the deal is comprised of a $60 million five-year revolver, a $400 million six-year first-lien term loan and a $200 million seven-year second-lien term loan, sources said.

Price talk is not yet available.

Bank of America and Barclays Capital are the lead banks on the facility.

Sedgwick Claims funding buyout

Proceeds from Sedgwick Claims' credit facility will be used to help fund the acquisition of the company by Stone Point Capital LLC and Hellman & Friedman LLC for $1.1 billion, including repayment of debt.

Fidelity National Financial Inc., Thomas H. Lee Partners LP, Evercore Capital Partners and other minority shareholders are buying the company.

Closing on the transaction is expected to take place during the second quarter, subject to usual and customary conditions and the receipt of regulatory approvals.

Sedgwick is a Memphis, Tenn.-based provider of claims and productivity management services to corporate and institutional clients.

Southern Wine reveals guidance

Southern Wine & Spirits of America held a bank meeting on Friday to kick off syndication on its proposed $2 billion five-year credit facility, and in connection with the launch, price talk was announced, according to a market source.

Both the $1 billion revolver and a $1 billion term loan are being talked at Libor plus 300 bps, and the revolver has a 50 bps unused fee, the source said.

Bank of America is the left lead bank on the facility that is being marketed to banks.

Proceeds will be used to refinance existing debt and for general corporate purposes.

Southern Wine is a Miami-based wine and spirits distributor.

Dave & Buster's sets talk

Official price talk on Dave & Buster's $150 million term loan B emerged now that the company has already held the bank meeting to launch the deal on Thursday afternoon, according to a market source, who said that the loan is being offered at Libor plus 425 bps with a 1.75% Libor floor and an original issue discount of 99.

Prior to the launch, unofficial guidance was circulating at Libor plus 400 bps with a 1.75% Libor floor.

JPMorgan and Jefferies are the joint lead arrangers and bookrunners on the $200 million credit facility (Ba2/BB-), which also includes a $50 million revolver.

Proceeds will be used to fund the buyout of the company by Oak Hill Capital Partners from Wellspring Capital Management LLC in a transaction valued at about $570 million - the completion of which is expected in the second quarter, subject to regulatory approvals and customary conditions.

Dave & Buster's is a Dallas-based owner and operator of restaurant/entertainment venues.

Multi Packaging readies allocations

Multi Packaging Solutions is expecting to allocate and free up for trading its $212.5 million credit facility (B2/B) early during the week of May 10, a market source told Prospect News on Friday.

The facility consists of a $182.5 million six-year term loan priced at Libor plus 500 bps with a 2% Libor floor and an original issue discount of 99, and a $30 million five-year revolver priced at Libor plus 400 bps with an upfront fee of 99.

During syndication, pricing on the term loan was changed from initial talk at launch of Libor plus 425 bps and then from revised talk of Libor plus 475 bps with a step-down to Libor plus 450 bps based on leverage.

In addition, the Libor floor was increased from initial talk of 1.75%, amortization on the term loan was increased to basically 5% a year from the typical 1% a year, the accordion was downsized to $75 million from $100 million, and the leverage test that needs to be met in order to use the incremental facility was tightened.

Multi Packaging lead banks

Wells Fargo, UBS and Barclays are the joint lead arrangers on Multi Packaging's credit facility that will be used for a dividend recapitalization.

Initially, the company was planning a $215 million term loan, but the tranche was downsized when the first pricing increase was announced.

The deal ended up oversubscribed after the second round of changes was made.

Multi Packaging Solutions is a New York-based entertainment packaging company.

Warner Chilcott slides

Moving to trading happenings, Warner Chilcott's strip of term loan B-1 and B-2 debt was weaker on Friday as the company released earnings and said that it was lowering guidance for full-year adjusted net income to $180 million to $205 million from $190 million to $215 million.

The strip of debt was quoted by one trader at 99 bid, par offered, down from par bid, par 3/8 offered, and by a second trader at 99 5/8 bid, par offered, down from 99¾ bid, par 1/8 offered.

For the quarter ended March 31, Warner Chilcott reported a net loss of $17.2 million, or $0.07 per diluted share, versus net income of $43.3 million, or $0.17 per diluted share, in the comparable 2009 quarter.

Total revenue for the quarter was $761.3 million, an increase of 209.5% from $246 million in the prior year.

The Rockaway, N.J.-based specialty pharmaceutical company said that the acquisition of the branded prescription pharmaceuticals business of Procter & Gamble Co. on Oct. 30, 2009 significantly impacted its financial position and results of operations in the quarter.

Warner Chilcott repays debt

Also during the quarter, Warner Chilcott prepaid $400 million of borrowings under its senior secured credit facility.

In addition, the company redeemed the remaining portion of its 8.75% senior subordinated notes due 2015.

Net interest expense for the quarter ended March 31 was $72.4 million, an increase of $54.4 million, or 301.8%, from $18 million in the prior year quarter.

The higher net interest expense was primarily due to an increase in the amount of outstanding debt under the company's senior secured credit facility used to fund the prescription pharmaceuticals business of Procter & Gamble.

As of March 31, the company's cash and cash equivalents totaled $246 million and total debt outstanding was $2.52 billion.

HCA flat to lower

HCA's term loans were unchanged to weaker, depending on which trader was asked, in a softer secondary market as the company released first-quarter earnings results and announced plans for an initial public offering of common stock.

The term loan B-1 was quoted by one trader at 95 bid, 95¾ offered, flat on the day, by a second trader at 94¾ bid, 95¾ offered, and by a third trader at 94½ bid, 95½ offered, down from 95¼ bid, 95¾ offered.

And, the term loan B-2 was quoted by the first trader at 97½ bid, 98 offered, unchanged, by the second trader at 96¾ bid, 97¾ offered, down a quarter of a point, and by the third trader at 96½ bid, 97½ offered, down from 97½ bid, 98 offered.

The third trader remarked that the IPO news was not much of a surprise. "Been rumored for a while," he added.

HCA income grows

For the first quarter, HCA's net income improved to $388 million, compared to $360 million in the prior year's first quarter.

Revenues for the quarter increased to $7.544 billion, compared to $7.431 billion in the first quarter of 2009.

Adjusted EBITDA for the quarter totaled $1.574 billion, compared to $1.457 billion in the previous year.

And, as of March 31, the company's balance sheet reflected cash and cash equivalents of $388 million, total debt of $26.855 billion, and total assets of $24.091 billion.

HCA plans IPO

Under the proposed IPO, HCA will sell a maximum of $4.6 billion of stock, but is estimating gross proceeds, excluding the underwriters' option to purchase additional shares, of $2.5 billion, according to an S-1 filed with the SEC on Friday.

The net proceeds from the offering will be used to repay certain existing debt - to be determined prior to the stock sale - and for general corporate purposes.

HCA's ratings, including the B2 corporate family, the Ba2 on the ABL revolver, and the Ba3 on the remaining bank debt, were put under review for possible upgrade by Moody's Investors Service as a result of the IPO news.

Moody's said that its review will focus on the extent of the expected reduction in leverage, further mitigation of refinancing risk and recent improvements in operating results.

HCA is a Nashville, Tenn.-based operator of hospitals and freestanding surgery centers.

U.S. Silica closes

In other news, U.S. Silica closed on its $165 million term loan (B1/BB-) on Friday, according to a market source.

Pricing on the term loan, which allocated and broke for trading above par on Thursday, is Libor plus 400 bps with a 1.75% Libor floor, and it was sold at an original issue discount of 991/2.

During syndication, the term loan was upsized from $160 million, pricing was reduced from Libor plus 450 bps and the original issue discount tightened from 99.

BNP Paribas acted as the lead bank on the deal that was used to refinance existing debt and fund a dividend.

U.S. Silica is a Berkeley Springs, W.Va.-based producer of ground and unground silica sand, kaolin clay, aplite and related industrial minerals.

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