Autoparts, OM, MCCI, United States Infrastructure break; Masergy, Water Pik revise deals

By Sara Rosenberg

New York, July 28 - Autoparts Holdings Ltd.'s credit facility began trading on Thursday, with the first- and second-lien term loans seen trading above their original issue discount prices, and OM Group Inc., MCCI Medical Group and United States Infrastructure Corp. (USIC) freed up, too.

Over in the primary market, Masergy Communications Inc. added a Libor floor to its credit facility, and Water Pik Inc. reduced the size of its term loan while setting pricing at the wide end of guidance.

Also, Lender Processing Services Inc. and Level 3 Financing Inc. revealed price talk on their credit facilities as the deals were presented to lenders during market hours, MSC.Software Corp. released original issue discount guidance, and Metropolitan Health Networks Inc. zeroed in on timing for the launch of its credit facility.

Autoparts frees up

Autoparts Holdings' credit facility made its way into the secondary market on Thursday, with the $530 million six-year first-lien term loan (B1/B+) quoted at par ¼ bid, par ¾ offered, according to a trader. By late day, a second source was quoting it at par bid, par 7/8 offered.

And, the company's $150 million 61/2-year second-lien term loan (Caa1/B-) was quoted at 101 bid, 102 offered on the open, the trader said. Meanwhile, later in the day, another source saw it at 101 bid, 102 1/8 offered.

Pricing on the first-lien term loan is Libor plus 500 basis points, and pricing on the second-lien term loan is Libor plus 900 bps, with both having a 1.5% Libor floor and an original issue discount price of 991/2, after tightening earlier from 99.

The first-lien loan has 101 soft call protection for one year, and the second-lien loan has call protection of 103 in year one, 102 in year two and 101 in year three.

Autoparts getting revolver

Autoparts Holdings' $730 million senior secured credit facility also includes a $50 million five-year revolver (B1/B+) priced at Libor plus 500 bps with a 1.5% Libor floor.

Credit Suisse Securities (USA) LLC, HSBC Securities (USA) Inc. and Nomura are the joint lead arrangers the deal that will be used, along with $307 million of equity, to fund the acquisition of the company by Rank Group from Honeywell in a cash transaction valued at about $950 million.

Closing is expected in the third quarter, subject to regulatory approval and customary conditions. It is not subject to financing.

Autoparts is a Danbury, Conn.-based supplier to the light- and heavy-duty vehicle aftermarket for replacement parts.

OM Group tops OID

OM Group's credit facility broke, with the $350 million U.S. term loan B quoted at 99¾ bid, par ¼ offered on the open and then it moved up to par bid, par ½ offered, a trader told Prospect News.

Pricing on the term loan B is Libor plus 425 bps with a 1.5% Libor floor, and it was sold at an original issue discount of 99. There is 101 soft call protection for one year.

The company's term loan B debt also includes a $250 million equivalent euro tranche that is priced at Euribor plus 475 bps with a 1.5% floor. It sold at a discount of 99 and includes 101 soft call protection for one year as well.

During syndication, the U.S. B loan was upsized from $300 million and pricing was reduced from talk of Libor plus 475 bps to 500 bps, and the euro B loan was downsized from $300 million and the spread was trimmed from Euribor plus 500 bps.

OM Group funding acquisition

Proceeds from OM Group's $900 million senior secured deal (Ba2/BB-), which also includes a $200 million revolver and a $100 million term loan A, both priced in line with talk at Libor plus 375 bps with no Libor floor, will be used to fund the €700 million acquisition of Vacuumschmelze Holding GmbH.

Bank of America Merrill Lynch, PNC Capital Markets LLC and BNP Paribas Securities Corp. are the lead banks on the deal.

Closing is expected by the end of the third quarter, subject to customary conditions and regulatory approvals, and net debt to EBITDA is expected to be below 2.0 times.

OM Group is a Cleveland-based solutions provider of specialty chemicals, advanced materials, electrochemical energy storage and unique technologies. Vacuumschmelze is a Hanau, Germany-based manufacturer of industrial use advanced magnetic materials and fabricated products.

MCCI hits secondary

MCCI Medical Group's $140 million first-lien term loan also began trading, with levels quoted at 99 bid, par offered, according to a market source.

Pricing on the first-lien term loan, as well as on a $15 million revolver, is Libor plus 450 bps with a 1.5% Libor floor, and the debt was sold at an original issue discount of 99.

During syndication, the spread on the facility firmed at the tight end of the Libor plus 450 bps to 500 bps talk.

The Miami-based operator of medical centers' $195 million credit facility also provides for a $40 million second-lien term loan that was not syndicated.

GE Capital Markets and SunTrust Robinson Humphrey Inc. are the lead banks on the deal that will be used to refinance existing debt and fund a dividend.

USIC breaks

United States Infrastructure was yet another deal to free up, with the $190 million term loan quoted at 99½ bid, par ½ offered, according to a market source.

Pricing on the term loan, and on a $60 million revolver, is Libor plus 425 bps with a 1.25% Libor floor. The debt was sold at an original issue discount of 99 for new money orders and at 99¾ for rollover commitments.

Essentially, through this transaction, the company upsized its revolver by $15 million and its term loan by $75 million, and repriced the existing debt from Libor plus 400 bps with a 1.5% Libor floor. The additional loan funds are being used for acquisition financing.

GE Capital Markets and BNP Paribas Securities Corp. are the lead banks on the deal for the Carmel, Ind.-based provider of utility infrastructure locating services.

Masergy adds floor

Moving to the primary, Masergy Communications added a 1% Libor floor to its $110 million credit facility, while leaving pricing unchanged at Libor plus 450 bps with an original issue discount of 99, according to a market source.

The facility consists of a $15 million revolver and a $95 million term loan.

GE Capital Markets and SunTrust Robinson Humphrey Inc. are the lead banks on the deal that will be used to help fund the buyout of the company by ABRY Partners LLC.

Senior leverage is 4.0 times.

Masergy is a Plano, Texas-based provider of secure, virtualized network services.

Water Pik tweaks deal

Also coming out with changes was Water Pik, as it trimmed its six-year term loan to $130 million from $177 million, resulting in a reduction in the size of the dividend that the company will be paying, according to a market source.

Also, pricing on the term loan and on the company's $20 million five-year revolver firmed at Libor plus 525 bps, the high end of the Libor plus 500 bps to 525 bps talk. The 1.5% Libor floor and original issue discount of 99 were left intact. The term loan has 101 soft call protection for one year.

GE Capital Markets is the lead bank on the $150 million deal, down from $197 million, that, in addition to paying a dividend, will be used to refinance existing debt.

Water Pik is a Fort Collins, Colo.-based developer and manufacturer of personal and oral health care products.

Lender Processing talk

In more new deal happenings, Lender Processing Services held a bank meeting on Thursday morning to kick off syndication on its proposed $1.3 billion senior secured credit facility (Baa3/BBB), and with the launch, price talk was announced, according to a market source.

Both the $400 million five-year revolver and $350 million five-year term loan A are being talked at Libor plus 225 bps, the source said. The revolver has a 50 bps unused fee.

Meanwhile, the $550 million seven-year term loan B is being talked at Libor plus 325 bps to 350 bps with a 1% Libor floor, an original issue discount of 99½ and 101 soft call protection for one year, the source continued.

Commitments are due on Aug. 9 and closing is expected later in the month, subject to customary conditions.

Lender Processing lead banks

Also revealed at Lender Processing Services' bank meeting was that left lead, J.P. Morgan Securities LLC, has added some additional leads, including Wells Fargo Securities LLC, U.S. Bank and SunTrust Robinson Humphrey Inc., the source remarked.

Proceeds from the credit facility will be used to refinance existing debt, including an existing senior secured credit facility, and for general corporate purposes.

Company officials said in a conference call earlier this week that the refinancing is expected to increase the average interest rate by 100 bps to 200 bps, while enhancing liquidity, extending maturities and providing more flexibility under covenants.

Lender Processing Services is a Jacksonville, Fla.-based provider of integrated technology, services and loan performance data and analytics to the mortgage, consumer lending, capital markets and real estate industries.

Level 3 official guidance

Level 3 announced official talk on its $650 million six-year senior secured covenant-light term loan B II of Libor plus 425 bps with a 1.25% to 1.5% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, as the deal launched with a conference call, according to a market source.

Price talk didn't come as much of a surprise since during the company's earnings call on Wednesday, officials had remarked that they expected the loan to be guided at Libor plus 425 bps with a 1.25% to 1.5% Libor floor.

The guidance came out slightly different from what was outlined in earlier filings with the Securities and Exchange Commission. Those documents had pricing at Libor plus 400 bps with a 1.5% Libor floor and a discount of 99. The soft call protection was expected to be part of the transaction.

Bank of America Merrill Lynch, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Morgan Stanley Senior Funding Inc. and Credit Suisse Securities (USA) LLC are leading the deal.

Level 3 to buy Global Crossing

Proceeds from Level 3's new term loan will be used to help fund the acquisition of Global Crossing Ltd. and refinance existing debt. Level 3 will give Global Crossing shareholders 16 shares of its common stock for each share of Global Crossing common stock or preferred stock that is owned at closing.

Based on Level 3's closing stock price on April 8, the transaction is valued at $23.04 per share, or about $3 billion, including the assumption of $1.1 billion of net debt as of Dec. 31.

The ratio of net debt-to-adjusted EBITDA, post synergies, is anticipated to be 4.4 times and gross debt-to-adjusted EBITDA after synergies is expected to be 5.0 times.

Closing is expected before the end of this year, subject to regulatory approvals and the approval of the stockholders of each company.

Level 3 is a Broomfield, Colo.-based provider of fiber-based communications services. Global Crossing is a Florham Park, N.J.-based IP, Ethernet, data center and video services provider.

MSC.Software reveals OID

Another deal to launch on Thursday was MSC.Software, at which time lenders were told that the $215 million six-year term loan is being talked with an original issue discount of 99, according to a market source.

Price talk on the term loan came out ahead of the launch at Libor plus 500 bps with a 1.5% Libor floor. There is 101 soft call protection for one year.

The company's $235 million credit facility (B+) also includes a $20 million revolver.

Bank of America Merrill Lynch is the lead bank on the deal that will be used to refinance existing debt and fund a dividend.

MSC.Software is a Santa Ana, Calif.-based provider of multidiscipline simulation solutions that accelerate product innovation.

Metropolitan Health launch

Metropolitan Health Networks firmed up timing on its proposed $355 million senior secured credit facility, with the scheduling of a bank meeting for Wednesday, according to a market source.

The facility consists of a $25 million five-year revolver, a $240 million five-year first-lien term loan and a $90 million six-year second-lien term loan.

Official talk not yet available. Based on filings with the Securities and Exchange Commission, however, pricing on the revolver and first-lien term loan is expected at Libor plus 475 bps with a 1.5% Libor floor, with the revolver having a 50 bps unused fee, and pricing on the second-lien term loan is expected at Libor plus 850 bps with a 1.75% Libor floor.

Also, the second-lien loan is anticipated to have call protection of 103 in year one, 102 in year two and 101 in year three.

Metropolitan, Continucare

Proceeds from Metropolitan Health's credit facility will be used, along with cash and investments, to fund the acquisition of Continucare Corp. for $6.25 in cash and 0.0414 of a share of Metropolitan common stock per share. The transaction is valued at approximately $416 million.

GE Capital Markets Inc. is the lead arranger and bookrunner on the deal.

Closing is expected in the third quarter, subject to shareholder approval and clearance under the Hart-Scott-Rodino Act.

Metropolitan Health is a Boca Raton, Fla.-based health care organization that provides health care services for Medicare Advantage members and other patients in Florida. Continucare is a Miami-based provider of primary care physician services on an outpatient basis.

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