Sedgwick dips on buyout; Inmar, Ascend Learning, Sleepy's break; changes abound in primary

By Sara Rosenberg

New York, Jan. 27 - Sedgwick Inc.'s term loan headed lower in the secondary market on Monday as the debt is expected to be taken out in connection with the company's newly announced buyout plans, and Inmar Inc., Ascend Learning and Sleepy's Intermediate LLC freed up for trading.

Meanwhile, in the primary market, VAT tightened the spread and original issue discount on its term loan while also shortening the soft call protection, Harland Clarke Holdings Corp. revised its deal so as to get a new larger term loan instead of a tack-on term loan, and VWR Funding Inc. firmed pricing at the low end of guidance.

Also, Mergermarket USA Inc. reverse flexed pricing on its first- and second-lien term loans for a second time, Phillips Pet Food & Supplies moved some funds between its term loans and modified original issued discounts, nTelos Inc. increased the size of its term loan and modified the offer price, and Southwire Co. and Insight Global (IG Investments Holdings LLC) accelerated their commitment deadlines.

Additionally, SBA Communications Corp., Ardagh Group and HD Supply Inc. disclosed talk with launch, YRC Worldwide Inc. reemerged with new credit facility plans, and Ziggo and Learfield Communications Inc. joined this week's calendar.

Sedgwick softens

Sedgwick's term loan feel off in trading on Monday to par ¼ bid, par ¾ offered form 101 bid, 101½ offered after news surfaced that the company will be acquired by KKR and management for about $2.4 billion from Hellman & Friedman LLC and Stone Point Capital LLC, according to a trader.

Funding for the buyout will come from a $1,655,000,000 credit facility that will launch with a bank meeting at 10:30 a.m. ET in New York on Thursday and equity.

The facility consists of a $125 million five-year revolver, a $1.02 billion seven-year first-lien term loan with a 1% Libor floor and a $510 million eight-year second-lien term loan with a 1% floor, a source said.

UBS Securities LLC, Deutsche Bank Securities Inc., KKR Capital Markets, Mizuho and Morgan Stanley Senior Funding Inc. are leading the deal, with UBS left on the first-lien and Deutsche Bank left on the second-lien.

Closing is expected this quarter, subject to customary conditions and regulatory approvals.

Sedgwick is a Memphis, Tenn.-based provider of technology-enabled claims and productivity management services.

Inmar frees up

Also in trading, Inmar's credit facility broke, with the $350 million seven-year first-lien covenant-light term loan (B1/B) quoted at 99½ bid, par offered and the $105 million eight-year second-lien covenant-light term loan (Caa1/CCC+) quoted at par bid, 101 offered, according to a market source.

Pricing on the first-lien term loan is Libor plus 325 basis points and pricing on the second-lien term loan is Libor plus 700 bps, with both having a 1% Libor floor and sold at an original issue discount of 99. The first-lien term loan includes 101 soft call protection for six months, and the second-lien term loan has call protection of 102 in year one and 101 in year two.

During syndication, pricing on the first-lien term loan was reduced from Libor plus 350 bps and pricing on the second-lien loan was cut from Libor plus 750 bps.

Inmar funding buyout

Proceeds from Inmar's $505 million credit facility, which also provides for a $50 million five-year revolver (B1/B), will be used to help fund its acquisition by ABRY Partners from New Mountain Capital.

Credit Suisse Securities (USA) LLC and BNP Paribas Securities Corp. are leading the deal.

Inmar is a Winston-Salem, N.C.-based provider of tech enabled promotion and inventory, logistics and settlement services.

Ascend Learning breaks

Ascend Learning's credit facility began trading as well, with the $408 million 51/2-year term loan quoted at par bid, a trader said.

Pricing on the term loan is Libor plus 500 bps with a 1% Libor floor and it was sold at an original issue discount of 991/2. There is 101 soft call protection for one year.

During syndication, the term loan was upsized from $405 million, pricing was lowered from Libor plus 550 bps and the discount was changed from 99.

The company's $448 million credit facility (B3/B) also includes a $40 million five-year revolver.

Bank of America Merrill Lynch and GE Capital Markets are leading the deal that will refinance existing debt.

Burlington, Mass., and Leawood, Kan.-based Ascend Learning is a provider of technology-based learning services focused on student training and testing results in health care and other vocational fields.

Sleepy's tops par

Sleepy's $167,025,000 first-lien term loan due March 30, 2019 freed up for trading too, with levels quoted at par ¼ bid, par ¾ offered, a market source said.

Pricing on the loan is Libor plus 400 bps with a 1% Libor floor and it was issued at par. There is 101 soft call protection for six months.

Credit Suisse Securities (USA) LLC is leading the deal that is being used to reprice an existing term loan from Libor plus 450 bps with a 1.25% Libor floor.

Sleepy's is a Hicksville, N.Y.-based specialty mattress retailer.

VAT revises loan

Over in the primary, VAT cut the coupon on its $405 million seven-year first-lien covenant-light term loan (B+) to Libor plus 375 bps from Libor plus 425 bps, moved the original issue discount to 99½ from 99, set the 101 soft call protection for six months instead of one year and eliminated the MFN sunset, according to a market source. The 1% Libor floor was unchanged.

In addition to the term loan, the company's credit facility includes a CHF 30 million five-year revolver.

Commitments were due at 5 p.m. ET on Monday, the source said.

Credit Suisse Securities (USA) LLC and UBS Securities LLC are leading the deal that will help fund the buyout of the company by Capvis and Partners Group.

VAT is a Sennwald, Switzerland-based vacuum valves company.

Harland Clarke restructures

Harland Clarke changed its loan plans to get a $600 million first-lien covenant-light term loan B-4 (B1/B+) due August 2019 talked at Libor plus 500 bps with a 1% Libor floor, an original issue discount of 99½ and 101 soft call protection for one year, according to a market source.

Previously, the company was looking to get a $500 million first-lien covenant-light tack-on term loan B-3 due May 2018 that was talked at Libor plus 550 bps with a 1.5% Libor floor, a discount of 99 and call protection of 102 through April 2014, then 101 for a year.

Commitments were due at 2 p.m. ET on Monday, the source remarked.

The company is also getting a $150 million asset-based revolver due Feb. 20, 2018 with pricing that can range from Libor plus 175 bps to 225 bps, based on availability, and an unused fee that can range from 37.5 bps to 50 bps based on usage.

Harland lead banks

Credit Suisse Securities (USA) LLC, Bank of America Merrill Lynch, Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and Jefferies Finance LLC are leading the deal will be used to help fund the acquisition of Valassis for $34.04 per share in cash, representing a transaction value of about $1.84 billion, to refinance existing debt and for general corporate purposes.

Other funds for the transaction will come from $275 million of senior secured notes and $540 million of unsecured notes, downsized from $590 million, as a result of the term loan upsizing. The other $50 million of additional term loan funds being raised through the upsizing will be used to refinance existing floating rate notes.

Closing is expected this quarter, subject to the tender of the majority of Valassis' shares, expiration under the Hart-Scott-Rodino Antitrust Improvements Act and customary conditions.

Harland Clarke is a San Antonio-based provider of payment, marketing and security services. Valassis is a Livonia, Mich.-based provider of media services.

VWR finalizes pricing

VWR set pricing on its $587 million senior secured term loan B due April 3, 2017 at Libor plus 325 bps, the tight end of the Libor plus 325 bps to 350 bps talk, and on its €573 million senior secured term loan B due April 3, 2017 at Euribor plus 350 bps, the low end of the Euribor plus 350 bps to 375 bps talk, a market source said.

Both tranches still have no floor, a par offer price and 101 soft call protection for six months.

Citigroup Global Markets Inc. and Bank of America Merrill Lynch are leading the deal (B+) that will be used to reprice the four tranches of existing U.S. and euro term loan debt due April 3, 2017, comprised of a roughly $240 million term loan priced at Libor plus 425 bps, a roughly $349 million term loan priced at Libor plus 400 bps, a roughly €474 million term loan priced at Euribor plus 450 bps and a roughly €101 million term loan priced at Euribor plus 425 bps, the source added.

Allocations are expected to go out on Tuesday with closing targeted for Wednesday.

VWR is a Radnor, Pa.-based provider of laboratory supplies, equipment and services.

Mergermarket cuts pricing

Mergermarket reduced the spread on its U.S. equivalent £165.22 million seven-year first-lien term loan (B2/B) to Libor plus 325 bps from revised talk of Libor plus 350 bps and initial talk of Libor plus 375 bps, and kept the 1% Libor floor, original issue discount of 99¾ and 101 soft call protection for six months intact, according to a market source.

In addition, pricing on the U.S. equivalent £70 million eight-year second-lien term loan (Caa2/CCC+) was trimmed to Libor plus 650 bps from revised talk of Libor plus 675 bps and initial talk of Libor plus 725 bps, but the 1% Libor floor, discount of 99½ and call protection of 102 in year one and 101 in year two were unchanged, the source said.

Last week, at the time of the first pricing flex, the first-lien term loan was upsized from £150 million and the discount was revised from 99½ and the second-lien term loan was downsized from £63.88 million and the discount was tightened from 99.

Mergermarket getting revolver

Mergermarket's credit facility, for which recommitments were due by 5 p.m. ET on Monday, also includes a $40 million five-year revolver (B2/B).

UBS Securities LLC, Mizuho Securities USA Inc. and HSBC Securities (USA) Inc. are leading the deal that will be used to help fund the acquisition of Mergermarket Group by BC Partners from Pearson plc for £382 million, and due to the first-lien term loan upsizing, to add cash to the balance sheet.

Closing is expected by the end of this quarter.

First-lien leverage is 4.5 times and total leverage is 6.2 times.

Mergermarket is a provider of corporate financial news, intelligence and analysis with headquarters in New York, London and Hong Kong.

Phillips Pet changes emerge

Phillips Pet Food lifted its first-lien term loan (B1/B) to $280 million from $260 million and modified the offer price to 99¾ from 991/2, and decreased its second-lien term loan (Caa1/CCC+) to $110 million from $130 million while tightening the discount to 99½ from 99, according to a market source.

As before, the first-lien term loan is priced at Libor plus 350 bps with a 1% Libor floor and has 101 soft call protection for six months, and the second-lien loan is priced at Libor plus 725 bps with a 1% Libor floor and has call protection of 102 in year one and 101 in year two.

This is the second round of changed made to the deal. Last week, pricing on the first-lien term loan was cut from talk of Libor plus 375 bps to 400 bps and the soft call protection was added, and pricing on the second-lien loan was trimmed from talk of Libor plus 750 bps to 775 bps.

Phillips deadline

Recommitments for Phillips Pet's $450 million credit facility, which also includes a $60 million ABL revolver, are due at noon ET on Tuesday, the source added.

Jefferies Finance LLC, Goldman Sachs Bank USA and BMO Capital Markets are leading the deal that will be used to help fund the buyout of the company by Thomas H. Lee Partners from AEA Investors.

Phillips Pet is an Easton, Pa.-based distributor of pet food and supplies.

nTelos reworks deal

nTelos raised its add-on term loan B to $188 million from $148 million and moved the original issue discount to 99¾ from talk of 99 to 991/2, a market source said.

As before, the add-on is priced at Libor plus 475 bps with a 1% Libor floor, in line with the existing term loan B.

J.P. Morgan Securities LLC, UBS Securities LLC, Deutsche Bank Securities Inc. and Union Bank are leading the deal that will be used to refinance existing term loan A borrowings, and, because of the upsizing, to add cash to the balance sheet, the source added.

nTelos is a Waynesboro, Va.-based provider of wireless and wireline communications services.

Southwire shutting early

Southwire changed the commitment deadline on its $750 million seven-year covenant-light term loan (Ba3/BB+) to 5 p.m. ET on Wednesday from Friday, a market source said.

The term loan is talked at Libor plus 275 bps to 300 bps with a 0.75% Libor floor, an original issue discount of 99½ and 101 soft call protection for six months.

The company's $1.75 billion senior secured deal also includes a $1 billion five-year asset-based revolver.

Bank of America Merrill Lynch, BMO Capital Markets, Wells Fargo Securities LLC and Macquarie Capital are leading the facility that will be used to help fund the acquisition of Coleman Cable Inc. for $26.25 per share in cash in a transaction valued at about $786 million, including the assumption of $294 million in net debt.

Closing is expected this quarter, subject to a majority of Coleman shares being tendered, the expiration of the waiting period under the Hart Scott Rodino Antitrust Improvements Act and other customary conditions.

Southwire is a Carrollton, Ga.-based wire and cable producer. Coleman is a Waukegan, Ill.-based manufacturer of electrical and electronic wire and cable products.

Insight moves deadline

Insight Global accelerated the commitment deadline on its fungible $90 million first-lien tack-on covenant-light term loan due October 2019 to 5 p.m. ET on Tuesday from Wednesday, according to a market source.

The tack-on loan is talked at Libor plus 425 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection through Nov. 1, 2014.

The spread and floor on the tack-on match the existing first-lien term loan.

Credit Suisse Securities (USA) LLC, Bank of America Merrill Lynch, RBC Capital Markets LLC and Wells Fargo Securities LLC are leading the deal that will be used to fund a dividend.

Insight Global is an Atlanta-based temporary staffing firm for the information technology sector.

SBA reveals talk

Also on the primary front, SBA Communications came out with talk of Libor plus 250 bps to 275 bps with a 0.75% Libor floor, an original issue discount of 99½ and 101 soft call protection for six months on its $1 billion seven-year incremental senior secured term loan B (BB) that launched with a call on Monday, according to a market source.

The term loan has a ticking fee of half the spread from day 46 until March 31, the source said.

Commitments are due on Feb. 3.

Citigroup Global Markets Inc. and Barclays are leading the deal that will be used to fund the acquisition of 2,007 wireless sites in Brazil from Oi SA for about R$1,525,000,000, which is expected to close by March 31.

SBA is a Boca Raton, Fla.-based first choice provider and owner and operator of wireless communications infrastructure.

Ardagh details

Ardagh held its call in the morning, at which time it launched to lenders a $700 million covenant-light term loan B due Dec. 17, 2019 talked at Libor plus 300 bps with a 1% Libor floor, an original issue discount of 99½ and 101 soft call protection for six months, according to a market source.

The term loan also has a ticking fee of half the spread from days 31 to 60 and the full spread thereafter, the source said.

Commitments are due at 5 p.m. ET on Wednesday and allocations are expected on Thursday.

Citigroup Global Markets Inc. is leading the deal that will be used with $830 million of notes to fund the acquisition of Verallia North America, a glass packaging company.

Ardagh is a Dublin-based supplier of glass and metal packaging.

HD Supply launches

HD Supply held a call, launching a $988 million covenant-light term loan due June 2018 with talk of Libor plus 275 bps to 300 bps with a 1% Libor floor, an offer price of 99¾ to par and 101 soft call protection for six months, according to a market source.

Proceeds will be used to refinance an existing term loan due October 2017 that is priced at Libor plus 325 bps with a 1.25% Libor floor.

Bank of America Merrill Lynch, Goldman Sachs Bank USA, Wells Fargo Securities LLC, Deutsche Bank Securities Inc., Credit Suisse Securities (USA) LLC, UBS Securities LLC, J.P. Morgan Securities LLC and Barclays are leading the deal.

HD Supply is an Atlanta-based wholesale distributor for the infrastructure and energy, maintenance, repair and improvement and specialty construction sectors.

YRC on deck

YRC will hold a bank meeting at 2 p.m. ET in New York on Tuesday to launch a $1.15 billion credit facility, according to a market source.

The facility consists of a $450 million ABL revolver, and a $700 million five-year senior secured term loan talked at Libor plus 675 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, the source said.

Credit Suisse Securities (USA) LLC is leading the deal that will be used to refinance existing bank debt.

Commitments are due on Feb. 11, the source added.

The company was originally going to bring a facility with the same tranching to market earlier this month, but that launch was cancelled as an agreement with teamsters was unable to be reached and creditors had made the financing contingent on contract approval. Recently, however, the company said that it reached a tentative agreement with teamsters on an extension of its collective bargaining agreement to March 2019.

YRC is an Overland Park, Kan.-based less-than-truckload carrier.

Ziggo coming soon

Ziggo set bank meetings in New York and London for Tuesday to launch a €3,735,000,000 equivalent senior secured term loan B due Jan. 15, 2022 that includes euro and U.S. dollar tranches, a 0.75% floor and 101 soft call protection for six months, according to a market source.

Credit Suisse Securities (USA) LLC and Bank of America Merrill Lynch are the global coordinators on the deal and bookrunners with ABN Amro Inc., Credit Agricole Securities (USA) Inc., Deutsche Bank Securities Inc., HSBC Securities (USA) Inc., ING Financial Markets LLC, J.P. Morgan Securities LLC, Morgan Stanley Senior Funding Inc., Nomura Securities Co. Ltd., Rabobank, Scotia Bank, Societe Generale and U.S. Capital Markets.

Commitments are due on Feb. 4.

Ziggo being acquired

Proceeds from Ziggo's term loan will be used to help fund its acquisition by Liberty Global plc in a stock and cash transaction valued at about €10 billion and to refinance existing debt.

Under the agreement, Ziggo shareholders will receive €11.00 in cash, 0.2282 Liberty Global Class A ordinary shares and 0.5630 Liberty Global Class C ordinary shares for each Ziggo share that they hold. The stock component equates to €3.4 billion and the cash component equates to €1.6 billion.

Closing is expected in the second half of this year.

Ziggo is a Utrecht, the Netherlands-based provider of entertainment, information and communication through television, internet and telephony services. Liberty Global is an Englewood, Colo.-based cable company.

Learfield readies loans

Learfield Communications surfaced with plans to hold a call at 2 p.m. ET on Tuesday to launch $85 million in fungible add-on covenant-light term loans, according to a market source.

The debt consists of a $60 million add-on first-lien term loan due October 2020 talked at Libor plus 400 bps with a 1% Libor floor and 101 soft call protection until April 2014, and a $25 million add-on second-lien term loan due October 2021 talked at Libor plus 775 bps with a 1% Libor floor and call protection of 102 until October 2014 and 101 until October 2015, the source said. Original issue discounts are still to be determined.

Deutsche Bank Securities Inc. is leading the deal for which commitments are due at noon ET on Friday.

Proceeds will be used to help fund the acquisition of Nelligan Sports Marketing Inc.

Learfield is a college sports multimedia rights marketing company.

Endeavour closes

In other news, Endeavour International Holding completed its $255 million of senior secured term loans due Nov. 30, 2017, a news release said.

Pricing on the Houston-based oil and gas exploration and production company's loans is Libor plus 700 bps with a 1.25% Libor floor and they were sold at an original issue discount of 981/2.

The debt, which was sold as a strip and includes a $125 million term loan that is collateral for letters of credit and a $130 million term loan that is a procurement facility, is non-callable for one year, then at par, except for $98 million of the procurement facility, which can be called at par for six months.

During syndication, pricing on the term loans was reduced from revised talk of Libor plus 750 bps, but still came wide of initial talk of Libor plus 600 bps.

Credit Suisse Securities (USA) LLC is leading the deal that was used to refinance existing debt and for general corporate purposes.

Community Health wraps

Community Health Systems Inc. closed on its acquisition of Health Management Associates Inc. for $13.78 per share, according to a news release.

With the transaction, Community Health got a new $4,601,000,000 seven-year covenant-light term loan D that is priced at Libor plus 325 bps with a 1% Libor floor. Of the total amount, $2,925,000,000 is new debt that was sold at a discount of 99½ and the remainder is extended term loan C debt that was sold at a discount of 993/4. There is 101 soft call protection for six months.

During syndication, the amount of new term loan D debt was increased from $2.26 billion and the discount on this portion was tightened from 99, the discount on the extended debt was revised from 991/2, the spread on the entire tranche was reduced from Libor plus 375 bps, and the maximum leverage, minimum interest coverage and maximum capital expenditures covenants were removed.

The extension pushed out the maturity on about 50% of the company's existing term loan C to 2021 from 2017.

Community Health term E

Community Health also got a new $1,676,000,000 term loan E due Jan. 25, 2017 that was added during syndication as non-extending term C lenders were offered the chance to exchange their debt into the new covenant-light E loan priced at Libor plus 325 bps with no floor and issued at par, or be paid out at par. This tranche has 101 soft call protection for six months.

The company's credit facility (Ba2/BB) includes a $1 billion five-year revolver and a $1 billion five-year term loan A as well.

Credit Suisse Securities (USA) LLC and Bank of America Merrill Lynch were the joint physical bookrunners on the deal, and Citigroup Global Markets Inc., Goldman Sachs Bank USA, J.P. Morgan Securities LLC, RBC Capital Markets, SunTrust Robinson Humphrey Inc., UBS Securities LLC and Wells Fargo Securities LLC were bookrunners too.

Community Health is a Nashville, Tenn.-based hospital company. Health Management is a Naples, Fla.-based owner and manager of hospitals and ambulatory surgery centers.

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