Aeroflex launches $800 million deal; Verint upsizes, slashes talk; U.S. Foodservice to launch

By Paul A. Harris

Portland, Ore., April 26 - Players focused on the primary market on Tuesday, and the new deal calendar grew.

Aeroflex Inc. launched an $800 million deal.

Verint Systems Inc. upsized its credit facility and slashed price talk.

Although the series 16 LCDX bank loan index ended the session unchanged at 100 5/8 bid, there is a good bid in the Street for paper, according to a bank loan trader.

The recently priced Open Link Financial Inc. term loan B was 99 3/8 bid, according to the trader, who added that the deal priced at 99.

Aeroflex launches $800 million

In the primary market, Aeroflex launched its $800 million credit facility on Tuesday.

The deal includes a $725 million seven-year term loan B that is talked at Libor plus 325 basis points to 350 bps with a 1.25% Libor floor at 99.5.

The facility also includes a $75 million five-year revolver.

J.P. Morgan Securities LLC, Goldman Sachs & Co., Morgan Stanley & Co. Inc. and Credit Suisse Securities (USA) LLC are the leads.

Proceeds will be used to refinance existing debt.

U.S. Foodservice to launch

Elsewhere, U.S. Foodservice Inc. plans to launch a $1 billion credit facility on Wednesday morning.

The structure and pricing have not been announced, the source added.

JPMorgan and Deutsche Bank Securities Inc. are the leads.

The Columbia, Md., broadline foodservice distributor plans to use the proceeds to refinance debt.

Recounting that Neiman Marcus Group Inc. is also in the market with a $2.76 billion amended and restated senior secured credit facility, a bank loan trader said that both Neiman Marcus and U.S. Foodservice are attempting to take out bond debt with new loan paper.

Select Medical sets meeting

Select Medical Corp. plans to hold a Wednesday bank meeting in order to launch its $1.5 billion credit facility, according to market sources.

The deal is comprised of a $1.2 billion term loan and a $300 million revolver.

JPMorgan, Goldman Sachs, Bank of America Merrill Lynch, Morgan Stanley, Wells Fargo Securities LLC and RBC Capital Markets LLC are leading the deal.

Proceeds will be used to refinance debt. The company announced a tender offer for $61l.5 million of senior subordinated notes due 2015 on Monday.

Alliance Data goes pro rata

Alliance Data Systems Corp. will launch $1.5 billion of pro rata debt at a Thursday bank meeting.

The deal is comprised of a $750 million five-year term loan A and a $750 million five-year revolver.

SunTrust Robinson Humphrey Inc. is the lead arranger.

KAR plans Thursday launch

KAR Auction Services, Inc. plans to launch a $1.75 billion credit facility on Thursday.

The deal features a $1.5 billion senior secured term loan B and a $250 million revolver.

Goldman Sachs, Barclays Capital Inc., Deutsche Bank and JPMorgan are the lead banks.

Proceeds will be used to refinance the company's existing senior secured revolver and term loan B, its 10% senior subordinated notes due 2015 and a portion of its 8¾% senior notes due 2014. Its floating-rate senior notes due 2014 will remain outstanding.

Verint upsizes, slashes talk

Verint Systems upsized its credit facility to $800 million from $780 million on Tuesday.

Price talk on the upsized $600 million 61/2-year term loan was slashed.

New talk on the deal fixed the Libor spread at 325 basis points, down from Libor plus 350 bps to 375 bps. The Libor floor remains 1.25%. The discount was decreased to 99.5 from 99. In addition, a one-year 101 soft call has been added.

Talk on the $200 million five-year revolver remains at Libor plus 350 bps to 375 bps, with a 50 bps unused fee and a 1.25% Libor floor, at 99.

Recommitments are due Wednesday.

Credit Suisse, RBC, Deutsche Bank and HSBC are the leads for the debt-refinancing deal.

Star West sets price talk

Star West Generation LLC talked its $650 million seven-year term loan with a Libor spread of 375 bps to 400 bps and a 1.5% Libor floor.

The deal is expected to come discounted to 99.5 and to contain a one-year 101 soft call.

Commitments are due on May 9.

The $750 million credit facility (Ba3//) also features a $100 million five-year revolver.

Barclays, RBC and Citigroup Global Markets Inc. are the leads.

Proceeds will be used to help fund Highstar Capital's acquisition of 100% of the equity interests of the Arlington Valley and Griffith power generation plants located in Arizona from LS Power.

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