Nine West breaks; Spirit AeroSystems softens; Mallinckrodt, KAR Auction modify deals

By Sara Rosenberg

New York, March 5 - Nine West Holdings Inc.'s credit facility made its way into the secondary market on Wednesday, and Spirit AeroSystems' term loan was a bit lower as the company launched a repricing and extension of the debt.

Moving to the primary, Mallinckrodt plc finalized pricing on its term loan B at the low end of talk, added a step-down and tightened the original issue discount, and KAR Auction Services Inc. revised its term loan sizes, and updated pricing on its B-2 tranche.

Furthermore, CEVA Group plc, RCS Capital Corp., Ennis Flint (Road Infrastructure Investment LLC), Lands' End Inc. and USJ-Imeco came out with price talk on their deals with launch, and American Tire Distributors Inc. surfaced with new loan plans.

Nine West frees up

Nine West's credit facility began trading on Wednesday, with the $445 million 51/2-year term loan B (Ba3/B+) quoted at par ¾ bid, 101½ offered and the $300 million 53/4-year unsecured guaranteed term loan (B3/B-) quoted at 101 bid, 102 offered, according to a trader.

Pricing on the term loan B is Libor plus 375 basis points 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.

The unsecured loan is priced at Libor plus 525 bps with a 1% Libor floor and a discount of 99. This tranche is still non-callable for 18 months, then at 102 for a year and 101 for the following year.

The term loans have a ticking fee of half the spread from days 46 to 90 and the full spread thereafter.

The company's $970 million credit facility also includes a $225 million asset-based revolver.

During syndication, the term loan B was downsized from $470 million and pricing firmed at the high end of revised talk of Libor plus 350 bps to 375 bps and wide of initial talk of Libor plus 325 bps to 350 bps, the unsecured loan was added to the capital structure and then upsized from $250 million, the ticking fees were added to the term loans, and the revolver was reduced from $250 million.

Nine West being acquired

Proceeds from Nine West's credit facility, a $455 million senior unsecured bridge loan or senior notes and equity will be used to fund the buyout of parent company Jones Group Inc. by Sycamore Partners for $15.00 per share in cash in a transaction valued at about $2.2 billion, including net debt.

The amount of equity being used was reduced due to the earlier addition of the unsecured term loan.

Morgan Stanley Senior Funding Inc., Jefferies Finance LLC and MCS Capital Markets LLC are leading the term loans. Wells Fargo Securities LLC and Bank of America Merrill Lynch are leading the revolver.

With the buyout, Jones Group will transfer ownership of its Jones Apparel business, its Kurt Geiger business and its Stuart Weitzman business to separate Sycamore affiliates, leaving it to be comprised of the Nine West business and the Jeanswear business.

Closing is expected in the second quarter, subject to shareholder and regulatory approvals.

Nine West is a designer, marketer and wholesaler of apparel, footwear and accessories.

Spirit AeroSystems dips

In more trading happenings, Spirit AeroSystems' roughly $540 term loan dropped to par bid, par ½ offered from par ¼ bid, par ¾ offered with news of a repricing and extension transaction, according to a trader.

In the afternoon, the company held a call, launching a roughly $540 million term loan due Sept. 15, 2020 with talk of Libor plus 250 bps with a 0.75% Libor floor, an original issue discount of 99¾ and 101 soft call protection for one year, a source remarked.

Proceeds will be used to reprice from Libor plus 300 bps with a 0.75% Libor floor and extend from April 18, 2019 the company's existing term loan.

Bank of America Merrill Lynch and Morgan Stanley Senior Funding Inc. are leading the deal.

Spirit AeroSystems is a Wichita, Kan.-based aircraft parts company.

Mallinckrodt changes emerge

Over in the primary, Mallinckrodt firmed the spread on its $1.3 billion seven-year covenant-light term loan B at Libor plus 275 bps, the tight end of the Libor plus 275 bps to 300 bps talk, added a step-down to Libor plus 250 bps at 3.75 times net total leverage and moved the original issue discount to 99¾ from 991/2, according to a market source.

The B loan still has a 0.75% Libor floor and 101 soft call protection for six months.

In addition to the term loan B, the company's $1.55 billion credit facility (Ba3/BB+) includes a $250 million five-year revolver.

Recommitments were due at 3 p.m. ET on Wednesday, the source said.

Deutsche Bank Securities Inc. is leading the deal.

Mallinckrodt buying Cadence

Proceeds from Mallinckrodt's credit facility and cash on hand will be used to fund the purchase of Cadence Pharmaceuticals Inc. for $14.00 per share in cash, or about $1.3 billion on a fully diluted basis.

Closing is expected in mid-to late March, subject to customary conditions, the tender of a majority of Cadence Pharmaceuticals' shares and the expiration or termination of the waiting period under the Hart Scott Rodino Antitrust Improvements Act.

Mallinckrodt is a Dublin-based specialty pharmaceutical and medical imaging business. Cadence Pharmaceuticals is a San Diego-based biopharmaceutical company focused on commercializing products principally for use in the hospital setting.

KAR restructures

KAR Auction Services modified the size of its three-year term loan B-1 to $600 to $650 million from $500 million and left pricing at Libor plus 250 bps with no Libor floor and a par offer price, according to a market source. The debt still has 101 soft call protection for six months.

Meanwhile, the seven-year term loan B-2 size was revised to $1.12 to $1.17 billion from $1.27 billion, the spread was lifted to Libor plus 275 bps from Libor plus 250 bps, the offer price firmed at 993/4, the high end of the 99¾ to par talk, and the 101 soft call protection was extended to one year from six months, the source said. This tranche still has a 0.75% Libor floor.

Recommitments were due at 3 p.m. ET on Wednesday, the source added.

J.P. Morgan Securities LLC is leading the deal that will be used to refinance existing bank debt.

KAR is a Carmel, Ind.-based provider of vehicle auction services and a provider of floorplan financing to independent and franchise used vehicle dealers.

CEVA pricing details

CEVA held its bank meeting on Wednesday morning, and in connection with the event, talk on its $875 million seven-year first-lien covenant-light term loan was announced at Libor plus 500 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, according to a market source.

Of the total term loan amount, $275 million is for a synthetic letter-of-credit facility.

Also included in the company's $1,125,000,000 credit facility (B-) is a $250 million five-year revolver.

Commitments are due on March 13.

Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Goldman Sachs Bank USA, Morgan Stanley Senior Funding Inc., UBS Securities LLC and Apollo are leading the deal that will be used with $825 million of notes to refinance existing credit facility and bond debt, and pre-fund letters of credit.

CEVA is a London-based supply chain management company.

RCS holds meeting

RCS Capital Corp. launched in the afternoon its $550 million five-year first-lien term loan (B2/B+) with talk of Libor plus 500 bps to 550 bps with a 1% Libor floor, an original issue discount of 98½ to 99 and soft call protection of 102 in year one and 101 in year two, according to a market source.

Also, the $150 million seven-year second-lien term loan (Caa1/B-) was launched with talk of Libor plus 950 bps to 975 bps with a 1% Libor floor and a discount of 98, and is non-callable for two years, then at 103 in year three and 101 in year four, the source said.

The company's $725 million senior secured credit facility also includes a $25 million three-year revolver (B2/B+) that will be undrawn at closing.

Commitments are due at noon ET on March 18, the source continued.

RCS lead banks

Barclays and Bank of America Merrill Lynch are the lead banks on RCS' credit facility that will be used with equity from Luxor Capital Group and cash on hand to fund the $1.15 billion acquisition of Cetera Financial Group from Lightyear Capital and to refinance Cetera debt.

Closing is expected in the second quarter, subject to Finra approval and other customary conditions.

Leverage through the first-lien is 2.1 times, leverage through the bank facility is 2.7 times, total leverage is 3.1 times, and net leverage is 3 times, the source added.

RCS is a New York-based holding company that operates and grows businesses focused on the financial services industry. Cetera is an El Segundo, Calif.-based financial services holding company that provides independent broker-dealer services and investment advisory services.

Ennis Flint guidance

Ennis Flint released talk on its first- and second-lien term loans shortly ahead of its morning bank meeting, according to a market source.

The $390 million seven-year first-lien covenant-light term loan (B1) is talked at Libor plus 375 bps with a 1% Libor floor, an original issue discount of 99½ and 101 soft call protection for six months, and the $170 million 71/2-year second-lien covenant-light term loan (Caa1) is talked at Libor plus 725 bps with a 1% Libor floor, a discount of 981/2, and call protection of 102 in year one and 101 in year two, the source remarked.

The company's $635 million credit facility also includes a $75 million revolver (B1).

Commitments are due on March 18, the source added.

Credit Suisse Securities (USA) LLC, RBC Capital Markets and Fifth Third Securities Inc. are leading the deal that will be used by the Thomasville, N.C.-based manufacturer and marketer of traffic safety and pavement marking products to refinance existing debt and fund a dividend.

Lands' End reveals talk

Lands' End held its lender meeting in the morning, launching its $515 million seven-year covenant-light term loan B (B1) with talk of Libor plus 375 bps to 400 bps with a 1% Libor floor, an original issue discount of 99 to 99½ and 101 soft call protection for six months, a market source said.

Commitments are due by 5 p.m. ET on March 13, the source added.

Bank of America Merrill Lynch is leading the deal that will fund a dividend to Sears Holdings Corp. in connection with the spin-off of Lands' End from Sears.

Lands' End is a Dodgeville, Wis.-based multi-channel retailer of casual clothing, accessories and footwear, and home products.

USJ-Imeco launches

USJ-Imeco disclosed talk of Libor plus 500 bps with a 1% Libor floor, an original issue discount of 99½ and 101 soft call protection for six months on its $90 million six-year term loan that launched with a bank meeting during the session, a source remarked.

The company's $105 million credit facility also includes a $15 million five-year revolver.

BNP Paribas Securities Corp. is leading the deal that will be used to fund an acquisition.

USJ-Imeco is a provider of turnkey marine joiner, marine electro-mechanical and furniture solutions that was formed through the merger of two J.F. Lehman portfolio companies, Crozet, Va.-based US Joiner and Iron Mountain, Mich.-based Imeco Inc.

XO sets deadline

XO Communications LLC held its bank meeting to launch its $500 million seven-year first-lien term loan and investors were asked to get their commitments in by March 14, a market source said.

As previously reported, the term loan is talked at Libor plus 325 bps with a 1% Libor floor, an original issue discount of 99½ and 101 soft call protection for six months.

UBS Securities LLC is leading the deal that will be used to fund a network investment.

XO, owned by Carl Icahn, is a communications service provider.

American Tire readies loan

American Tire Distributors set a lender meeting for 10 a.m. ET on Friday to launch a $300 million senior secured covenant-light term loan due June 2018, according to a market source.

Bank of America Merrill Lynch is leading the deal that will be used to help fund the acquisition of Terry's Tire Town Holdings Inc., an Alliance, Ohio-based tire distributor.

Closing is expected in late March or early April.

American Tire is a Huntersville, N.C.-based replacement tire distributor.

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