Skilled Healthcare, DineEquity up with numbers; Focus Brands breaks; Fibertech sets pricing

By Sara Rosenberg

New York, Nov. 2 - Skilled Healthcare Group Inc.'s term loan headed higher during Tuesday's trading session on the back of the release of better-than-expected quarterly results and an upward revision to full-year guidance, and DineEquity Inc.'s term loan was better with earnings as well.

Continuing in secondary market news, Focus Brands Inc.'s credit facility freed up for trading, with the term loan quoted above its original issue discount price.

Over in the primary, Fibertech Networks firmed the spread on its term loan at the tight end of initial guidance, while the Libor floor came at the wide end, Global AutoCare reduced pricing and original issue discount on its term loan, and Auto Europe removed its facility from market.

Also, Leslie's Poolmart Inc. accelerated the commitment deadline on its credit facility, and Vertis Holdings Inc. came out with new plans for its refinancing.

Additionally, Lantiq raised pricing on its term loan and sweetened the call protection, and Deltek Inc. upsized its term loan while reducing spread, floor and discount.

In terms of the forward calendar, Dunkin' Brands Inc. and Arizona Chemical Inc. firmed up timing on the launch of their credit facilities, and Burlington Coat Factory Warehouse Corp., Sunquest Information Systems and Pelican Products Inc. emerged with plans for new deals.

Meanwhile, Royall & Co. and Paxton Media Group LLC released price talk on their proposed credit facilities as both transactions are getting ready to launch on Wednesday.

Skilled Healthcare rises

Skilled Healthcare's term loan was stronger in trading as the company's third-quarter numbers beat analyst estimates and guidance for the full year was increased, according to a trader.

The term loan was quoted at 97¼ bid, 97¾ offered, up from 96¾ bid, 97½ offered, the trader said.

For the third quarter, the company reported a net loss of $25.31 million, or $0.68 per share, compared to net income of $9.05 million, or $0.24 per share, in the prior year. However, adjusted net income for the quarter, which excludes a $53.5 million charge related to litigation costs, was $9.4 million, or $0.25 per diluted share.

Consolidated revenue for the quarter was $209.2 million, an increase of 11.6% from $187.5 million in the third quarter of 2009.

And, adjusted EBITDA for the quarter was $30.6 million, up 18.2% from $25.9 million last year.

Skilled revises guidance

In addition, Skilled Healthcare increased its 2010 full year guidance, excluding the impact of the $53.5 million litigation charge in the third quarter.

The company now expects diluted adjusted net income per common share to be between $0.92 and $0.97.

Revenue for the year is now expected to be between $805 million and $812 million.

And, adjusted EBITDA is now anticipated to be in the range of $116 million to $120 million.

Skilled Healthcare is a Foothill Ranch, Calif.-based health care services company.

DineEquity gains ground

DineEquity's term loan moved up to 101¼ bid, 101¾ offered from 101 1/8 bid, 101 5/8 offered as it too came out with favorable third-quarter results, according to a trader.

For the quarter, the company had net income of $7.8 million, or $0.44 per diluted share, compared to $7.9 million, or $0.46 per diluted share, in the previous year.

And, total revenues for the quarter were $335.4 million, compared to $333.6 million in the third quarter of 2009.

Also, the company revised consolidated cash from operations guidance to range between $155 million and $165 million for full-year 2010 from previous expectations of $135 to $145 million.

DineEquity is a Glendale, Calif.-based owner of Applebee's Neighborhood Grill & Bar and IHOP Restaurants.

Focus Brands frees up

Focus Brands' credit facility hit the secondary market on Tuesday, with the $275 million term loan quoted at 99¾ bid on the break and then it moved up to par ½ bid, 101¼ offered, according to a market source.

Pricing on the term loan is Libor plus 550 basis points with a step-down to Libor plus 525 bps based on 3.5 times total leverage and a 1.75% Libor floor. The tranche was sold at an original issue discount of 99.

The company's $285 million credit facility (B2/B) also includes a $10 million revolver that is also priced at Libor plus 550 bps with a 1.75% Libor floor and was sold at a discount of 99.

During syndication, the spread on the term loan and the revolver flexed up from initial talk of Libor plus 475 bps to 500 bps while the discount tightened from 981/2. Also, the pricing step-down was added to the term loan.

Focus buying Auntie Anne's

Proceeds from Focus Brands' credit facility will be used to fund the acquisition of Auntie Anne's, a Lancaster, Pa.-based hand-rolled soft pretzel chain.

In addition, the new deal will be used to refinance existing debt.

Credit Suisse is the lead bank on the credit facility.

Focus Brands is an Atlanta-based franchisor and operator of ice cream stores, bakeries, restaurants and cafes.

Fibertech sets pricing

Moving to the primary, Fibertech Networks firmed the spread on its $235 million term loan B at Libor plus 500 bps, the low end of the Libor plus 500 bps to 550 bps talk, and the Libor floor at 1.75%, the high end of the 1.5% to 1.75% talk, according to a market source.

The original issue discount on the term loan B remained unchanged at 981/2, the source added.

TD Securities is the lead bank on the $260 million credit facility (B2/B), which also includes a $25 million revolver.

Proceeds from the facility, along with equity, will be used to fund the buyout of the company by Court Square Capital Partners from Nautic Partners and Ridgemont Equity Partners.

Closing is expected later this year, subject to regulatory approvals.

Fibertech is a Rochester, N.Y.-based provider of fiber optic bandwidth services.

Global AutoCare flexes

Global AutoCare announced on Tuesday that it reduced pricing on its $300 million term loan to Libor plus 425 bps from Libor plus 475 bps, cut the original issue discount to 99 from 98½ and added 101 soft call protection for one year, according to a market source.

As before, the term loan includes a 1.75% Libor floor.

The company's $350 million credit facility (Ba3/B+) also provides for a $50 million revolver.

JPMorgan, Natixis and RBC Capital are the joint lead arrangers on the deal.

Global AutoCare buyout

Proceeds from global AutoCare's credit facility will be used, along with equity and $275 million of notes, to fund the acquisition of Clorox Co.'s global auto care business by Viking Acquisition Inc., an entity formed by Avista Capital Partners, for roughly $780 million.

The notes offering was upsized from an original amount of $250 million.

Closing on the acquisition is expected by year-end, subject to regulatory and other customary approvals and conditions.

Global AutoCare is a manufacturer, marketer and distributor of automotive aftermarket appearance and performance auto-care products.

Auto Europe shelved

Auto Europe's $235 million credit facility - comprised of a $15 million revolver, a $150 million first-lien term loan and a $70 million second-lien term loan - has been pulled from market, according to a source.

Price talk on the revolver and first-lien term loan at launch had been Libor plus 500 bps to 550 bps with a 1.75% Libor floor. The original issue discount on the first-lien term loan and price talk on the second-lien term loan were to be determined.

Oppenheimer & Co. and KeyBanc Capital Markets were acting as the lead banks on the deal that was going to be used to refinance existing debt and to fund a dividend payment.

Auto Europe is a Portland, Maine-based distributor of car rental services for Europe-bound leisure travelers.

Leslie's moves deadline

Leslie's Poolmart revised the commitment deadline on its $300 million credit facility to Tuesday from Thursday as the deal is significantly oversubscribed, and allocations may go out as early as Wednesday, according to a market source.

The facility consists of a $225 million seven-year term loan talked at Libor plus 475 bps with a 1.5% Libor floor and an original issue discount of 981/2, and a $75 million revolver.

Bank of America, Wells Fargo and Goldman Sachs are the lead banks on the deal that will be used to refinance existing bonds and an existing revolver and to pay off a shareholder that is exiting the investor group.

Leslie's Poolmart is a Phoenix-based retailer of swimming pool supplies and related products.

Vertis starts over

Vertis Holdings has received new commitments for its proposed credit facility that will be used to refinance existing debt after reworking its initial credit facility plans a number of times.

Under the new structure, the company plans on getting a $425 million term loan that is being led by Morgan Stanley, according to a news release. Timing and talk is still to be determined.

By comparison, the company was originally planning on getting a $425 million first-lien term loan led by Credit Suisse and Citadel, which was then downsized to $365 million and later upsized to $500 million. The company was also planning a $150 million second-out term loan that was going to be backstopped by existing holders, but that was later removed from the capital structure and was going to be replaced by mezzanine debt.

At the time of launch, price talk on the first-lien term loan had been Libor plus 900 bps with a 2% Libor floor and an original issue discount of 97. There was call protection of 104 in year one, 103½ in year two, 102 in year three and 101 in year four.

Vertis revolver commitment

In addition to the new term loan commitment, Vertis now plans on getting a $175 million revolver that is being led by GE Capital, the news release said.

Under the original plans, the company was looking to get a $200 million asset-based revolver, which was later downsized to $190 million. This revolver had been clubbed up with relationship banks.

GE Capital, Bank of America and Citibank provided commitments towards the original revolver, with GE the left lead.

As part of the refinancing, the company is offering holders of its senior pay-in-kind notes due 2014 and senior secured second-lien notes due 2012 the opportunity to exchange their existing debt by Dec. 1 for equity only, as compared to previous offers of cash, new senior secured notes and equity.

Vertis may file

In conjunction with the exchange offers, Vertis is soliciting acceptances of a pre-packaged Chapter 11 reorganization plan.

If there is not enough participation in the exchange offers, but the plan of reorganization is accepted, Chapter 11 proceedings will be started in order to complete the refinancing.

With the credit facility commitments from GE Capital and Morgan Stanley, the company should be able to complete the reorganization within 45 days to 60 days of filing.

Vertis is a Baltimore-based marketing communications company.

Lantiq reworks loan

Lantiq made some revisions to its $225 million term loan, including flexing pricing up to Libor plus 675 bps from talk of Libor plus 600 bps to 625 bps and providing for hard call protection of 102 in year one and 101 in year two, instead of just 101 soft call protection for one year, according to a market source.

In addition, amortization on the term loan is now 5% in year one, 12.5% in year two and 10% every year thereafter.

As before, the loan has a 2% Libor floor and is being offered at an original issue discount of 98.

Other changes made to deal include eliminating the super-priority status on the $20 million revolver so that it's ranked pari passu with the term loan and reducing the accordion feature to $50 million.

Lantiq refinancing debt

Proceeds from Lantiq's credit facility will be used to refinance its capital structure, which is currently all equity funded.

Deutsche Bank and Barclays are the lead banks on the $245 million credit facility.

Recommitments are due from lenders on Wednesday.

Prior to the changes, the term loan was rated B+ and the revolver was rated BB.

Lantiq is a Neubiberg, Germany-based provider of broadband and voice telephony semiconductor services.

Deltek cuts pricing

Deltek reduced pricing on its term loan due in 2016 to Libor plus 400 bps with a 1.5% Libor floor and an original issue discount of 99, from initial talk of Libor plus 425 bps with a 1.75% floor and a discount of 981/2, according to a market source.

Furthermore, the oversubscribed tranche was upsized to $200 million from $190 million, the source said.

Credit Suisse and RBC are the lead banks on the now $230 million, up from $220 million, secured credit facility (B1/BB) that also includes a $30 million revolver due in 2015.

Proceeds will be used to refinance an existing credit facility and for general corporate purposes.

Deltek is a Herndon, Va.-based provider of enterprise applications software designed specifically for project-focused businesses and professional services firms.

Dunkin' date revealed

Dunkin' Brands firmed up timing on its $1.35 billion senior credit facility as a bank meeting has been set for noon ET on Thursday, according to a market source, whereas previously, all that was known was that the launch would be sometime this week.

The facility consists of a $100 million revolver and a $1.25 billion term loan B, with price talk not yet available.

Barclays, JPMorgan, Bank of America and Goldman Sachs are the joint lead arrangers and joint bookrunners on the deal that will be used, along with $625 million of senior notes, to repay in full the company's outstanding securitization debt and to pay a cash dividend to stockholders.

Canton, Mass.-based Dunkin' Brands is the parent company of Dunkin' Donuts, a coffee and baked goods restaurant chain, and Baskin-Robbins, an ice cream specialty store chain.

Arizona Chemical sets timing

Arizona Chemical nailed down timing on the general syndication launch for its $520 million credit facility with the scheduling of a bank meeting at 1 p.m. ET in New York on Thursday, according to a market source.

The deal has already been shown to some banks during an early round syndication, and, prior to now, it was expected that the retail round would be coming soon, but exact timing had been unavailable.

The facility consists of a $50 million revolver and a $470 million term loan B, with price talk not yet released.

Goldman Sachs is the lead arranger on the deal.

Arizona Chemical being bought

Proceeds from Arizona Chemical's credit facility will be used to help fund American Securities' purchase of a controlling interest in the company from Rhone Capital.

Rhone, along with other current investors and the management team, will retain 25% of the company's ownership.

The transaction 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.

Burlington readies deal

Burlington Coat Factory has scheduled a bank meeting for Friday to launch a proposed $1 billion term loan that is being led by joint bookrunners JPMorgan and Goldman Sachs, according to a market source.

Proceeds will be used to help repay an existing term loan, redeem the company's outstanding 11 1/8% senior notes due 2014 and Burlington Coat Factory Investments Holdings Inc.'s outstanding 14½% senior discount notes due 2014, make a distribution to the equity holders and for general corporate purposes.

On Monday, the company said in an 8-K filed with the Securities and Exchange Commission that it intends to raise a total of $1.5 billion of new debt for the recapitalization.

Burlington is a Burlington, N.J.-based discount retailer.

Sunquest expected this month

Sunquest Information Systems is anticipated to hold a bank meeting around mid-November to launch a proposed $600 million first- and second-lien credit facility that will be used to refinance existing debt and fund a dividend payment, according to a market source.

Jefferies, the lead bank, is currently talking to some accounts about the deal.

Details on the structure of the facility and price talk are not yet available, the source said.

Sunquest is a Tucson, Ariz.-based provider of health care diagnostic information technology and outreach services.

Pelican Products coming soon

Pelican Products is expected to hold a bank meeting next week to launch a new credit facility, according to a market source.

Credit Suisse and GE Capital are the lead banks on the deal, with Credit Suisse the left lead.

Further details on the deal are not yet available.

Pelican Products is a Torrance, Calif.-based designer and manufacturer of advanced lighting systems and virtually indestructible cases.

Royall floats talk

Royall revealed price talk of Libor plus 500 bps to 550 bps with a 1.75% Libor floor and an original issue discount of 98 on its $103.25 million five-year senior secured credit facility as the deal is getting ready to launch with a bank meeting on Wednesday, according to a market source.

The facility is comprised of a $10 million revolver and a $93.25 million term loan.

GE Capital is the lead arranger on the deal that will be used for a dividend recapitalization.

Royall is a Richmond, Va.-based direct marketing company focused on working with colleges and universities to achieve their enrollment and financial goals.

Paxton guidance surfaces

Also coming out with talk ahead of its Wednesday bank meeting was Paxton Media Group, according to a market source.

The $10 million five-year revolver and the $20 million three-year term loan A are both being talked at Libor plus 450 bps with no Libor floor, and the $210 million six-year term loan B is being talked at Libor plus 550 bps with a 1.75% Libor floor and an original issue discount of 98, the source said.

Wells Fargo and U.S. Bank are the lead banks on the $240 million deal that will be used to refinance existing debt.

Paxton is a Paducah, Ky.-based newspaper and television company.

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