Upsized Charter drive-by, Shea Homes, Speedy Cash deals price; new Shea, Speedy deals trade up

By Paul Deckelman and Paul A. Harris

New York, May 3 - Charter Communications Inc. came to market on Tuesday with an upsized, quickly shopped $1.5 billion offering of 10-year notes, high-yield syndicate sources said. But the bonds of the St. Louis-based cable and broadband operator - one of the most familiar names in all of Junkbondland - came too late in the session for any kind of aftermarket.

Builder Shea Homes LP/Shea Homes Funding Corp. meanwhile priced a $750 million issue of eight-year secured notes. Traders saw the new bonds firm smartly from their par issue price.

Financial services operator Speedy Cash Intermediate Holdings Corp. brought an upsized $250 million secured notes issue, which also surged solidly when it was freed to trade.

And automotive transport company Jack Cooper Holdings Corp. drove by with a $35 million add-on to an existing tranche of 2015 senior secured bonds that it priced last fall.

On the forward calendar front, syndicate sources heard that Eagle Parent Inc. is about to hit the road with a $465 million deal that will partially fund private equity firm Apax Partners' pending acquisition of Epicor Software Corp. and another software provider, Activant Group Inc.

They also saw two prospective new deals coming out of the energy sector from Unit Corp. and from Saratoga Resources, Inc. Tulsa, Okla.-based Unit is likely to price during the coming week, and timing has not surfaced on Houston-based Saratoga's transaction.

Secondary trading was restrained and largely centered on the newly priced issues. Monday's mega-deal from DISH DBS Corp. firmed from its below-par issue price when it started trading, and Celanese Corp.'s new notes held on to their initial aftermarket gains.

Statistical performance indicators were mixed.

Charter massively upsizes

Tuesday's four issuers each brought a single tranche. In total, they raised $2.54 billion.

Trailing Monday's massively upsized $2 billion drive-by from DISH DBS, Charter Communications brought a quick-to-market deal that was also massively upsized.

Issuing via CCO Holdings, LLC and CCO Holdings Capital Corp., Charter priced $1.5 billion issue of 10-year senior notes (B3/BB-BB-) at par to yield 6½%. The yield printed on top of the price talk.

UBS Investment Bank was the left lead bookrunner for the debt-refinancing deal, which was upsized from $1 billion.

Merrill Lynch, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc. were the joint bookrunners.

It was a blowout, according to a source close to the deal.

Shea Homes oversubscribed

Elsewhere, Shea Homes priced a $750 million issue of eight-year senior secured notes (B2/B) at par to yield 8 5/8%, at the tight end of price talk that had been set in the 8¾% area.

Credit Suisse ran the books.

The Walnut, Calif.-based homebuilder plans to use the proceeds to refinance debt and for general corporate purposes.

The deal, which was a couple of times oversubscribed, went very well, according to an informed source.

Speedy Cash prices 10¾% notes

Speedy Cash priced an upsized $250 million issue of seven-year senior secured notes (B3/B) at par to yield 10¾%.

The yield printed at the tight end of the 10¾% to 11% price talk.

Jefferies & Co., Inc. and UBS Securities LLC were the joint bookrunners for the issue, which was upsized from $230 million.

Proceeds will be used to repay debt, to finance the acquisition of Cash Money Group and to redeem preferred stock.

Jack Cooper taps 12¾% notes

Finally, Jack Cooper Holdings priced a $35 million add-on to its 12¾% senior secured notes due Dec. 15, 2015 at 103.

The reoffer price came on top of the price talk.

The resulting yield to maturity is 11 7/8%, and the yield to worst is 11.796%.

Imperial Capital LLC ran the books for the quick-to-market deal.

Proceeds will be used for general corporate purposes, including the funding of capital expenditures.

The original $122.5 million issue priced at 99.079 to yield 13% on Nov. 22.

Epicor starts Wednesday

Dealers will begin a roadshow on Wednesday for Eagle Parent's $465 million offering of eight-year senior notes.

Merrill Lynch is the left lead bookrunner for the merger financing. RBC Capital Markets LLC is the joint bookrunner.

Unit slates $200 million

Unit plans to price a $200 million offering of 10-year senior subordinated notes (expected ratings B3/BB-/BB-) during the week ahead.

Merrill Lynch and BMO Nesbitt Burns are the joint bookrunners for the deal, which will be used to refinance debt and for general corporate purposes.

Saratoga plan first-lien deal

Finally, Saratoga Resources plans to sell $150 million of first-lien senior secured notes.

Timing on the deal has not been announced, and bookrunners have yet to step forward, sources added.

Proceeds will be used to refinance substantially all of the company's debt.

Shea leads the way

When Shea Homes' new eight-year senior secured notes were freed for secondary dealings, a trader saw those bonds jump to 101¾ bid on the break, well up from the par level at which the company priced its deal.

When two-sided trading began, a trader saw the new notes at 101¾ bid, 102¼ offered; at another desk, a market participant later saw the bonds get as good as 102 bid, with offer levels around 102¼ to 1021/2.

Going home, yet another trader saw the bonds late in the session back at 101¾ bid, 102½ offered.

Speedy Cash on the fast track

Speedy Cash's upsized seven-year senior secured notes meantime were at 101 bid "in a couple of spots," a trader said shortly after the notes priced, although he subsequently saw them at a wide 101½ bid, 103 offered.

Another trader later quoted the Wichita, Kan.-based financial services provider's new issue at 102 bid, 102¼ offered.

Checking on the issue later, he said that "some of the other pictures are much, much wider, surrounding that [earlier] level."

But yet another trader saw the new bonds going out at 102 bid, 102½ offered.

New Charter unseen

Charter Communications' new drive-by offering of CCO Holdings 10-year notes - which one trader called "the monster of the day" - came too late in the session for any kind of aftermarket dealings.

And the cabler's existing bonds were seen not much changed ahead of the deal.

The trader declared that "there was not a lot of activity" in the name.

He said that "a bunch" of Charter's CCO Holdings 7¼% notes due 2017 traded between 106½ and 107, which he saw as little changed from Monday's levels at 106 5/8 bid, 106 7/8 offered.

Another market source meantime pegged those '17s about 1/8 point lower on the day at 106 5/8.

New DISH firms from issue

Among the bonds that priced on Monday, a trader saw "a lot" of DISH DBS' new 6¾% notes due 2021 trading around during the morning, when they were freed for secondary dealings, "then they just kind of fizzled out."

He saw the Englewood, Colo.-based satellite television broadcaster's $2 billion tranche of bonds - massively upsized from the originally announced $1 billion - trading at par bid, 100½ offered. That was up around a point from the 99.093 level at which that drive-by deal priced on Monday to yield 6 7/8%, too late to trade around at that time.

A second trader said that early in the session, the bonds traded just a little bit above their issue price at 99½ bid, 99 7/8 offered before moving up to 100 3/8 bid, 100¾ offered, but he "didn't see much [activity] in them, with not much since then, for some reason."

Among the company's existing bonds, a trader saw its 7 1/8% notes trading up at 107¼ bid, 107½ offered, which he called "not much different" from their recent levels, seeing them unchanged to "up maybe one eighth."

The 7 1/8s were, he said, the most active junk bonds on the day and saw over $30 million changing hands.

At another desk, the bonds were seen up by one-quarter point at 1071/4.

Celanese holds gains

A trader saw Celanese Corp.'s new 5 7/8% notes due 2021 trading on Tuesday at 100¾ bid, 101 1/8 offered.

The Dallas-based chemical company had priced a quick-to-market $400 million offering of those bonds on Monday at par, and they had moved up in trading later that session to 100½ bid, 101 offered before going home at 100 7/8 bid, 101 3/8 offered.

A second trader saw the new bonds on Tuesday at 100¾ bid, 101 offered.

Ford still below issue

A trader said that Ford Motor Credit Co.'s new 5% notes due 2018 continued to trade no better than the par issue price at which the $1.25 billion deal from the Dearborn, Mich.-based loan financing arm of No. 2 U.S. carmaker Ford Motor Co. had come to market on Thursday.

He saw a $1 million transaction in the bonds at 99¾ bid.

The trader dismissed as not representative a few quotes seen during the day that had the bonds' bid levels as good as 101 or even 1011/4.

"Maybe 10 bonds [$10,000] traded there. Odd lots on that one are trading maybe a point or two higher" than par - while the more representative round-lot dealings of at least $1 million or more are holding steady at or slightly below par.

A second trader quoted the new Ford Credit bonds around the 99½ to 99 7/8 area, although he said that at "one point during the day," the bonds traded as high as 100¼ bid. "But most of the trades look like they took place down at a 99 handle."

Parent Ford's benchmark 7.45% bonds due 2031 were meantime seen by a trader up 1/8 bid at 113 5/8 bid, 114 5/8 offered. The bonds' continued firmness came against a backdrop Tuesday of Ford's announcement that new-vehicle sales rose by 16% in April from year-earlier levels to 189,778 units.

Ford said that sales of cars, including its fuel-thrifty Fusion and Escape models, rose 26% year-over-year. SUV sales, including its popular Explorer model, were up 11%, while truck sales, including long-time Ford mainstay F-150, were also up 11% from a year ago.

Secondary indicators mixed

Away from the new-issue realm, a trader saw the series 16 CDX North American High Yield index ease by three-sixteenths of a point on Tuesday to end at 102 15/16 bid, 103 1/16 offered after having gained one-eighth of a point on Monday.

The KDP High Yield Daily index meantime gave up 4 basis points on Tuesday to finish at 76.15 after having gained 10 bps on Monday. Its yield moved up by 1 bp to 6.44% after having come in by 4 bps on Monday.

But the Merrill Lynch High Yield Master II index continued to roll on, rising for a 10th consecutive session on Tuesday. It rose by 0.03%, which followed Monday's 0.114% rise. That lifted its year-to-date return to 5.633%, a new peak level for the year, from 5.602% on Monday, the previous zenith.

Advancing issues beat decliners for a fifth straight session on Tuesday, though only by a very slim margin, while overall market activity, as measured by dollar-volume levels, was up solidly from Monday's totals.

Harrah's bonds busy, lower

Among specific names, a trader said about $50 million to $60 million of Caesars Entertainment Corp.'s 10% notes due 2018 changed hands around 93, which he called down "a solid half-point."

"It's busy every day," he said, noting that there was no news out on the Las Vegas-based casino operator formerly known as Harrah's Entertainment Inc. to cause the volume. "But it's had such a big run up, I think people took a little pause."

The trader also saw the 12¾% second-lien senior secured notes due 2018 at 1021/2, "basically unchanged."

Another trader called the 10% notes down nearly a point at 93, while another placed the issue at 93½ bid, also down almost a point.

Sears dips on warning

Sears Holdings Corp.'s debt was softer "on the back of lesser numbers," a trader said, referring to the company's warning late Monday regarding its first-quarter results.

The trader said about $25 million to $30 million of the 6 5/8% notes due 2018 turned over at 96 bid, 96¼ offered. That compared with Monday levels of 98 bid, 98¼ offered, he said.

Another trader called the 6 5/8% notes down a point at 95½ bid, 96 offered.

The second trader saw the 7% notes due 2032 at 82 bid, 83 offered.

Late Monday, the Hoffman Estates, Ill.-based retailer said its domestic comparable-store sales were expected to fall 3.6% for the quarter ended April 30. Additionally, Sears said it expected to post a loss of $145 million to $195 million.

The market had previously been expecting a profit. Last year, the company reported net income of $16 million, or 14 cents per share.

TXU pace picks up

A trader said that the bonds of the company formerly known as TXU Corp. "seemed to be a little more active today, but it doesn't look like there was a whole lot of change."

For instance, he said that the 6½% bonds due 2024 issued by Energy Future Holdings Corp., the name the company has officially gone by since its 2007 leveraged buyout for $45 billion by Kohlberg, Kravis Roberts and TPG Capital, were around 54 bid, 55 offered, while its 10 7/8% secured bonds were around 93½ bid, 94½ offered. The 10¼% notes due 2015 issued by the Dallas-based utility operator and merchant power producer's Texas Competitive Holdings Corp. unit were around 64 bid, 65 offered. He said the bonds were ending "pretty much the way they started the day" with levels carried over from Monday's trading.

Another trader, however, quoted the 10 7/8s down seven-eighths of a point at 93 5/8 bid.

Also in the power-generation sphere, Houston-based Dynegy Holdings Inc.'s 7¾% notes due 2019 were unchanged at 78 bid, 79 offered on not much trading.

Stephanie N. Rotondo contributed to this report

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