Amneal, Avast, Bluestem, Genex break; First Advantage, Emerging Markets revise deals

By Sara Rosenberg

New York, June 26 – Amneal Pharmaceuticals LLC’s repriced term loan B hit the secondary market on Friday, with levels quoted above its issue price, and Avast, Bluestem Brands Inc., and Genex Holdings Inc. began trading as well.

Moving to the primary market, First Advantage (STG-Fairway Acquisitions Inc.) widened the spread and issue price on its first-lien term loan, and Emerging Markets Communications LLC returned the original issue discount and call protection on its second-lien term loan to originally proposed terms.

Amneal tops par

Amneal Pharmaceuticals’ repriced $735 million term loan B-1 allocated and freed up for trading on Friday, with levels quoted at par ¼ bid, par ¾ offered, according to a market source.

Pricing on the loan is Libor plus 350 basis points with a 1% Libor floor, and it was issued at par. There is 101 soft call protection for six months.

During syndication, the spread on the loan firmed at the high end of the Libor plus 325 bps to 350 bps talk, and the debt was made to be fungible with an existing $200 million term loan B-2 already priced at Libor plus 350 bps with a 1% Libor floor, creating a $935 million term loan B tranche.

With the switch to a fungible loan, amortization on the term loan B-1 was reduced to match the 1% amortization on the $200 million B-2 tranche, and the B-2 debt’s 101 soft call protection was refreshed for six months.

GE Capital Markets is leading the deal.

The repricing is taking the term loan B-1 down from Libor plus 400 bps with a 1% Libor floor.

Amneal Pharmaceuticals is a Bridgewater, N.J.-based manufacturer of generic pharmaceuticals.

Avast frees up

Avast’s $274 million first-lien covenant-light term loan (Ba3) due March 20, 2020 broke too, with levels quoted at par 1/8 bid, par 5/8 offered, a source remarked.

Pricing on the loan is Libor plus 325 bps, after firming at the wide end of the Libor plus 300 bps to 325 bps talk. The debt has a 1% Libor floor and 101 soft call protection for six months and was issued at par.

Credit Suisse Securities (USA) LLC is leading the deal that will be used to refinance a $399 million term loan priced at Libor plus 375 bps with a 1% Libor floor.

With the new term loan, there will be a concurrent $125 million paydown on the existing term loan.

The borrowers are Sybil Software LLC and Sybil Finance BV.

Avast is a Prague-based provider of security software for PCs, smartphones and tablets.

Bluestem starts trading

Another deal to free up was Bluestem’s fungible $280 million incremental first-lien term loan (B2/B+) due Nov. 7, 2020, with levels quoted at 99 bid, par offered, a market source said.

Pricing on the term loan is Libor plus 750 bps with a 1% Libor floor, in line with pricing on the company’s existing $279 million term loan, and it was sold at an original issue discount of 99. The incremental term loan, as well as the existing term loan, is getting 101 soft call protection for six months.

Credit Suisse Securities and Morgan Stanley Senior Funding Inc. are leading the deal that will be used with cash on hand to fund the acquisition of Orchard Brands Corp. for $410 million in cash, subject to various pre- and post-closing adjustments.

Closing is expected in the third quarter, subject to customary conditions, including regulatory approval and completion of financing.

Bluestem is an Eden Prairie, Minn.-based online retailer of name brand and private label general merchandise serving low-to-middle-income consumers. Orchard Brands is a multichannel retailer of apparel and home products focused on serving women and men above the age of 50.

Genex sets OIDs, breaks

Genex Holdings firmed the original issue discount on its $55 million add-on first-lien term loan at 99.5, the tight end of the 99.25 to 99.5 talk, a source remarked. Pricing on the loan is Libor plus 425 bps with a 1% Libor floor.

As for the $22.5 million add-on second-lien term loan, the discount finalized at 98.75, the tight end of the 98.5 to 98.75 talk, the source said. Pricing is Libor plus 775 bps with a 1% Libor floor.

With final terms in place, the new debt emerged in the secondary market on Friday, with the first-lien loan quoted at par bid, par ½ offered and the second-lien loan quoted at 98¾ bid, 99¾ offered, a trader added.

RBC Capital Markets and Jefferies Finance LLC are leading the $77.5 million in fungible first- and second-lien add-on term loans that will be used to fund two acquisitions.

Genex is a Wayne, Pa.-based provider of integrated managed care services.

First Advantage lifts pricing

In more happenings, First Advantage raised pricing on its $485 million seven-year covenant-light first-lien term loan to Libor plus 525 bps from Libor plus 475 bps and moved the original issue discount to 98.5 from 99, a market source said.

As before, the term loan has a 1% Libor floor and 101 soft call protection for one year.

Bank of America Merrill Lynch is leading the deal that will be used with a new second-lien facility to refinance existing debt and fund a dividend to shareholders.

First Advantage is a St. Petersburg, Fla.-based provider of talent acquisition services, including background screening, recruiting, skills assessment and skills-related tax services.

Emerging Markets tweaks deal

Emerging Markets Communications changed the original issue discount on its $92 million seven-year second-lien term loan (Caa1/CCC+) to 98.5 from revised talk of 98, but in line with initial talk of 98.5, and set the hard call protection back to the originally proposed 102 in year one and 101 in year two from revised talk of 103 in year one, 102 in year two and 101 in year three, according to a market source.

Pricing on the second-lien term loan is Libor plus 962.5 bps with a 1% Libor floor, after flexing earlier in syndication from talk of Libor plus 800 bps to 825 bps.

Also, the maturity on the second-lien term loan was previously shortened from eight years.

The company’s $400 million credit facility also includes a $40 million revolver (B1/B+) as well as a $268 million six-year first-lien term loan B (B1/B+) priced at Libor plus 575 bps with a 1% Libor floor and an original issue discount of 98.5. The first-lien term loan has 101 soft call protection for six months.

Pricing on the first-lien term loan recently was increased from talk of Libor plus 425 bps to 450 bps, the discount was widened from 99, and the maturity was shortened from seven years.

Emerging Markets buying MTN

Proceeds from Emerging Markets Communications will be used to fund the acquisition of MTN Communications, a Miramar, Fla.-based provider of communications and content for remote locations, and to refinance existing debt.

Commitments are due at noon ET on Monday.

Morgan Stanley Senior Funding, Citizens Bank and Macquarie Capital (USA) Inc. are leading the deal.

Closing is subject to regulatory review and other customary conditions.

Emerging Markets Communications is a Miami-based provider of hybrid global satellite and terrestrial communications.

Zep closes

In other news, the buyout of Zep Inc. by New Mountain Capital LLC for $20.05 per share in cash, or about $692 million, including net debt, has been completed, a news release said.

To help fund the transaction, Zep obtained a new $402.5 senior secured credit facility (B2/B+) that includes a $42.5 million five-year revolver and a $360 million seven-year term loan B.

Pricing on the term loan B is Libor plus 475 bps with a 1% Libor floor, and it was sold at an original issue discount of 99.5. There is 101 soft call protection for one year.

During syndication, pricing on the term loan was lowered from Libor plus 500 bps, and the discount was revised from 99.

Jefferies Finance, KeyBanc Capital Markets Inc. and Credit Suisse Securities led the deal.

Zep is an Atlanta-based consumable chemical packaged goods company.

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