Neiman extended, Gymboree break; AZ Chem, Sheridan revise deals; Vonage, Darling float talk

By Sara Rosenberg

New York, Nov. 17 - Neiman Marcus Inc.'s extended term loan freed up for trading during Wednesday's market hours, and with the entrance of the new tranche into the secondary, the existing - or non-extended loan - headed lower.

In more trading happenings, Gymboree Corp.'s credit facility broke for trading, with the term loan B quoted above par, and LyondellBasell's term loan headed lower as the company announced plans to pay down the debt.

Over in the primary market, Arizona Chemical Inc. (AZ Chem) came out with some changes to its credit facility, including upsizing the revolver, reducing pricing on the entire deal and trimming the original issue discount on the B loan, and Sheridan Holdings Inc. downsized its term loan.

Also, Vonage Holdings Corp. began circulating guidance on its term loan in preparation for its upcoming bank meeting, Darling International Inc. released talk on its loan as the deal was presented to lenders, and AutoTrader.com revealed that five additional banks signed on to lead its transaction.

Additionally, Cablevision Systems Corp. firmed timing on the launch of its credit facility, and Kenan Advantage Group emerged with plans for a new deal.

Neiman frees up

Neiman Marcus' extended term loan hit the secondary market on Wednesday, with levels quoted by one trader at 98¼ bid, 99 offered, by a second trader at 98 1/8 bid, 98 5/8 offered and by a third trader at 98¾ bid, 99 offered.

The non-extended term loan, meanwhile, was quoted by one trader at 96 bid, 97 offered and by a second trader at 96½ bid. This tranche moved down from levels of 98¼ bid, 99¼ offered on Tuesday, traders said.

The company succeeded in extending about $1.07 billion of its term loan debt by three years to April 2016, leaving about $436 million to mature in April 2013.

Pricing on the extended term loan is Libor plus 400 basis points with a step-down to Libor plus 375 bps when total leverage is at or below 5.0 times, and there is 101 soft call protection against repricings for one year, while pricing on the non-extended term loan is Libor plus 200 bps.

Neiman amendment fee

In return for the approval of its credit facility amendment and extension, Neiman Marcus is paying lenders a 10 bps amendment fee.

In addition to pushing out maturities, the amendment allows the company to get additional debt to refinance the non-extended term loan.

Credit Suisse and JPMorgan acted as the lead banks on the transaction.

During the amendment process, pricing on the extended loan was increased from initial talk of Libor plus 325 bps, and the step-down and call protection were added.

Neiman Marcus is a Dallas-based high-end specialty retailer.

Gymboree starts trading

Also freeing up for trading was Gymboree's credit facility, with the $820 million seven-year term loan B (B1/B+) quoted at par ¼ bid, par ¾ offered, according to a trader.

Pricing on the term loan B is Libor plus 400 bps with a 1.5% Libor floor, and it was sold at an original issue discount of 991/2. There is 101 soft call protection (repricing protection) for one year.

During syndication, the B loan was upsized from $720 million, the spread flexed down from Libor plus 450 bps, the floor was reduced from 1.75%, the discount was cut from 98½ and then from 99, and the call protection was added.

Credit Suisse and Morgan Stanley are the joint lead arrangers and bookrunners on the term loan B, with Credit Suisse the left lead.

Gymboree getting revolver

In addition to the term loan B, Gymboree expects to get a $225 million five-year asset-based revolver that is being led by Bank of America.

The revolver is anticipated to be split into a $213 million A tranche and a $12 million first-in, last-out A-1 tranche, according to a commitment letter filed with the Securities and Exchange Commission. If the company opts to reduce or terminate the A-1 tranche, those commitments can be added to the A tranche.

Initial pricing on the tranche A revolver is expected to be Libor plus 250 bps, and initial pricing on the tranche A-1 revolver is expected to Libor plus 400 bps, the filing said.

The initial commitment fee on the revolver is expected to be 62.5 bps.

Gymboree funding buyout

Proceeds from Gymboree's credit facility, equity and $400 million of notes will be used to fund the acquisition of the company by Bain Capital Partners LLC for $65.40 per share, or $1.8 billion. Bain is in the process of tendering for Gymboree's shares.

The bond offering was downsized by $100 million when the term loan B was upsized.

Completion of the buyout is subject to, among other things, the satisfaction of the minimum tender condition of at least 66% of the company's common shares, the receipt of the Federal Trade Commission's approval under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and other customary conditions.

Gymboree is a San Francisco-based specialty retailer.

LyondellBasell softens

LyondellBasell's term loan headed closer to par following the company's disclosure that it plans on paying down the $500 million senior loan by year-end, according to traders.

The term loan was quoted by one trader at par 1/8 bid, par 3/8 offered, down from par ¾ bid, 101 offered, and by a second trader at par bid, par 3/8 offered, down from par 5/8 bid, 101 1/8 offered.

The company also said on Wednesday that it expects to redeem $225 million of its $2.25 billion of 8% senior secured notes and €37.5 million of its €375 million of 8% senior secured notes, at a premium of 103.

The notes redemption date will be Dec. 17.

LyondellBasell is a Netherlands-based plastics, chemical and refining company.

AZ Chem tweaks facility

Moving to the primary, Arizona Chemical modified the size and pricing on its credit facility in the morning as the deal was met with strong demand and asked for recommitments by later in the day, according to a market source.

Under the changes, the revolver was increased to $60 million from $50 million, while the term loan B was left at $470 million.

Pricing on the two tranches was reverse flexed to Libor plus 500 bps from initial talk of Libor plus 525 bps to 550 bps, the source said. The 1.75% Libor floor was left unchanged.

And, regarding the term loan B, the original issue discount tightened to 98½ from 98, the source continued. As before, this tranche includes 101 soft call protection for one year.

AZ Chem lead banks

Goldman Sachs is the left lead bank on Arizona Chemical's $530 million, up from $520 million, credit facility (B1/B+). Early on, GE Capital and KeyBank put in sizeable commitments towards the transaction, so they were both named joint bookrunners and GE got the title of administrative agent.

Proceeds will be used to help fund American Securities' purchase of a controlling interest in the company from Rhone Capital, which, along with other current investors and the management team, will retain 25% of the company's ownership.

The acquisition is expected to close in the fourth quarter, subject to regulatory approvals and customary conditions.

Arizona Chemical is a Jacksonville, Fla., supplier of pine chemicals to the adhesives, inks and coatings and oleochemicals markets.

Sheridan cuts size

Sheridan Holdings downsized its incremental first-lien term loan to $90 million from $160 million while leaving pricing at Libor plus 375 bps with no Libor floor and an original issue discount of 95, according to a market source.

Recommitments are due on Thursday.

Earlier in the process, pricing had been revised from Libor plus 350 bps with a discount of 931/2.

Credit Suisse and Jefferies are the lead banks on the deal that will be used to fund acquisitions and to repay revolver borrowings.

The change in the term loan size was done since the company is acquiring less assets than originally planned, the source said.

Sheridan is a Sunrise, Fla.-based provider of physician services to hospitals and ambulatory surgical facilities.

Vonage releases guidance

Price talk on Vonage's $200 million senior secured term loan (B2/BB-) began making its way around the market as the company is getting ready to launch the deal with a bank meeting on Friday at 10 a.m. ET at the Le Parker Meridien in New York.

The loan is being talked at Libor plus 750 bps with a 1.75% Libor floor and an original issue discount of 97 to 98, and there is amortization of 10% per year, a market source told Prospect News.

Proceeds from the term loan, along with cash on hand, will be used to refinance existing term loans totaling $194 million.

The company has previously said that pricing on the new term loan is expected to be less than half the blended rate of the current debt, and that it anticipates saving more than $20 million in interest costs per year.

Vonage expected leverage

Following completion of the refinancing, Vonage expects total leverage at or below 1.5 times debt to EBITDA and net debt at around 1.1 times.

Closing on the new loan is expected to occur prior to Dec. 31.

Bank of America, Deutsche Bank and Citigroup are the lead banks on the deal.

Vonage is a Holmdel, N.J.-based provider of communications services connecting individuals and social networks through broadband devices.

Darling talk emerges

Darling International held a bank meeting on Wednesday to kick off syndication on its proposed credit facility, and in connection with the launch, price talk on the $300 million six-year term loan B (Ba2/BB+) was announced, according to a market source.

The term loan B is being talked at Libor plus 400 bps with a 1.5% Libor floor and an original issue discount of 99, the source said.

JPMorgan, BMO Capital, Goldman Sachs and PNC Bank are the lead banks on the $625 million senior secured credit facility, which also includes a $325 million five-year revolver (Ba2).

At close, $175 million will be drawn under the revolver.

Darling buying Griffin

Proceeds from Darling International's credit facility will be used to help fund the acquisition of Griffin Industries Inc. for $740 million in cash and about $100 million of common stock.

Other funds for the transaction will come from cash on hand and from $250 million of eight-year senior unsecured notes.

Closing is targeted for the week of Dec. 13, subject to customary conditions, including the expiration of the Hart-Scott-Rodino waiting period.

Total funded debt to EBITDA will exceed 3.0 times after completion of the transaction.

Darling is an Irving, Texas-based provider of rendering, recycling and recovery services to the food industry. Griffin is Cold Spring, Ky.-based provider of rendering, bakery feed and cooking oil recycling services.

AutoTrader gets more leads

AutoTrader.com announced that JPMorgan, Goldman Sachs, SunTrust, Fifth Third Bank and UBS signed on to lead its credit facility, joining left lead Well Fargo, according to a market source.

The $950 million credit facility (Ba3), which launched with a bank meeting on Wednesday, consists of a $150 million five-year revolver, a $200 million five-year term loan A and a $600 million six-year term loan B.

Price talk on the revolver and the term loan A is Libor plus 350 bps, while price talk on the term loan B is Libor plus 375 bps to 400 bps with a 1.5% Libor floor and an original issue discount of 99, the source said.

Autotrader buying Kelley

Proceeds from AutoTrader.com's credit facility will be used to fund the acquisition of Irvine, Calif.-based Kelley Blue Book and its sister companies, CDMdata and CDM Dealer Services.

Closing on the transaction is expected by the end of the year.

AutoTrader.com is an Atlanta-based automotive marketplace and consumer information website. Kelley Blue Book is a provider of new and used vehicle pricing information.

Amneal launches

Another deal to launch with a bank meeting on Wednesday was Amneal Pharmaceuticals LLC's $205 million five-year credit facility that is being led by GE Capital, according to a market source.

As was previously reported, the facility consists of a $50 million revolver and a $155 million term loan, with both tranches talked at Libor plus 450 bps to 475 bps with a 1.75% Libor floor and fees of 1.5%.

Proceeds will be used for a refinancing/recapitalization.

Amneal Pharmaceuticals is a Hauppauge, N.Y.-based generic pharmaceuticals company.

Cablevision sets launch

Cablevision has scheduled a bank meeting for Friday to launch its proposed $840 million credit facility, comprised of a $75 million revolver and a $765 million term loan, according to a market source.

Citigroup, Bank of America, Barclays, Credit Suisse and UBS are the lead banks on the deal that will be used, along with equity and $250 million of senior unsecured notes, to fund the acquisition of Bresnan Communications in a transaction valued at $1.365 billion.

The debt financing will be obtained by a newly formed, unrestricted subsidiary of the company so that it is non-recourse to Cablevision or its CSC subsidiary.

Closing on the acquisition is expected to occur by year-end.

Cablevision is a Bethpage, N.Y.-based telecommunications, media and entertainment company. Bresnan is a Purchase, N.Y.-based broadband telecommunications company.

Kenan readies launch

Kenan Advantage is set to hold a conference call at 1 p.m. ET on Thursday to launch its proposed $600 million credit facility that is being led by KeyBanc Capital Markets, according to a market source.

The facility consists of a $100 million revolver, a $375 million term loan and a $125 million delayed-draw term loan, the source said.

Kenan Advantage is a North Canton, Ohio-based logistics and liquid bulk transportation services provider to the fuels, chemical and food end-markets.

Columbian Chemicals closes

In other news, Columbian Chemicals Co. completed on Wednesday its $375 million senior secured credit facility (Ba3/BB) due in 2015 that is initially priced at Libor plus 350 bps after flexing down from Libor plus 375 bps during syndication, according to a market source.

The facility consists of a $300 million term loan A and a $75 million revolver.

UBS and JPMorgan acted as the lead banks on the deal that was used to refinance existing bank debt.

Columbian Chemicals is a Marietta, Ga.-based manufacturer of carbon black.

Precision wraps revolver

Precision Drilling Corp. closed on its $550 million senior secured revolver due in 2013, according to a news release.

During syndication, the revolver was downsized from $650 million as the company's bond offering was upsized to $650 million from $550 million.

Proceeds will be used to refinance existing debt.

Precision Drilling is a Calgary, Alberta, provider of energy services to the oil and gas industry.

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