Avaya, Constellium, Star West Generation, KAR, Huntsman break; Flexera Software tweaks deal

By Sara Rosenberg

New York, March 8 - Avaya Inc. launched on Friday morning an add-on term loan B-5, firmed the offer price at the tight end of talk shortly thereafter, and then freed up for trading in the afternoon above that issue price.

Also, Constellium Holdco BV broke for trading with levels on the U.S. loan seen above the revised original issue discount, and Star West Generation LLC, KAR Auction Services Inc. and Huntsman International LLC hit the secondary too.

Moving to the primary, Flexera Software LLC lowered the coupon on its credit facility and tightened the original issue discount.

Furthermore, ISS A/S and Ruby Western Pipeline Holdings set pricing guidance, and California Pizza Kitchen Inc. released original issue discount talk, as all of these deals were presented to lenders during the session, and Atkins Nutritionals Holdings II Inc. surfaced with new deal plans.

Avaya wraps 101

Avaya's $589 million add-on term loan B-5 due March 31, 2018 broke for trading on Friday, with levels quoted at par ¾ bid, 101¾ offered, according to a trader.

The loan launched to investors in the morning at talk of Libor plus 675 basis points with a 1.25% Libor floor and an offer price of par to par 1/2, and around mid-day, that offer price firmed at par 1/2, sources said. There is soft call protection of 102 through December 2013 and 101 through Dec. 2014, sources said.

The spread, floor and call protection are in line with the existing term loan B-5.

Commitments were due at 12:30 p.m. ET on Friday, after being accelerated from an original deadline of 2 p.m. ET.

Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc. and Barclays are leading the add-on that will be used to repay term loan B-1 debt, which is due 2014 and is priced at is Libor plus 275 bps with no floor.

Avaya is a Basking Ridge, N.J.-based provider of business collaboration and communications services.

Constellium tops OID

Constellium's $360 million seven-year term loan (B1/B) began trading as well, with levels quoted at par ½ bid, 101½ offered, sources said.

Pricing on the loan is Libor plus 500 bps with a 1.25% Libor floor, and it was sold a t adiscoutn of 991/2, after tightening from 99. The tranche is non-callable for one year, then at 102 in year two and 101 in year three.

In addition, the company is getting a €75 million seven-year term loan (B1/B) that is priced at Euribor plus 550 bps with a 1.25% floor and a discount of 99, and is also non-callable for one year, then at 102 in year two and 101 in year three.

Deutsche Bank Securities Inc., Goldman Sachs & Co. and BNP Paribas Securities Corp. are leading the deal that will be used to refinance existing debt and pay a dividend.

Constellium is a Paris-based designer and manufacturer of aluminum products and components.

Star West frees up

Star West Generation's credit facility also made its way into the secondary market, with the $750 million seven-year term loan B (Ba3/BB-) quoted at par ½ bid, 101½ offered on the break and then it moved up to par ¾ bid, 101¾ offered, according to a trader.

Pricing on the loan is Libor plus 400 bps 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.

During syndication, the loan was upsized from $725 million, pricing firmed at the tight end of the Libor plus 400 bps to 425 bps talk and the discount was revised from 99.

The $850 million senor secured credit facility (Ba3/BB-) also includes a $100 million five-year revolver.

Star West lead banks

Citigroup Global Markets Inc., Barclays, Morgan Stanley Senior Funding Inc and RBC Capital Markets are the joint lead arrangers on the term loan B, and the revolver is being led by these four banks as well as Union Bank.

Proceeds will be used to refinance existing debt in connection with the merger of Star West Generation and GWF Energy LLC, which are both portfolio companies of Highstar Capital. And, the funds raised through the term loan upsizing will be used for a dividend payment.

Star West Generation is a Houston-based owner of two combined cycle, gas-fired power generation plants in Arizona. GWF Energy is a Pittsburg, Calif.-based owner of three natural gas-fired power plants in California.

KAR Auction breaks

KAR Auction Services' $1.82 billion term loan B due May 2017 emerged in trading, with levels quoted at par ¾ bid, 101¼ offered, according to a trader.

Pricing on the loan is Libor plus 275 bps with a 1% Libor floor, and it was issued at par. There is 101 soft call protection through November 2013.

During syndication, the spread was reduced from Libor plus 300 bps with a step-down to Libor plus 275 bps.

J.P. Morgan Securities LLC is the lead bank on the deal.

Of the total term loan amount, $150 million is incremental debt that will be used to redeem $150 million of floating-rate senior notes due May 1, 2014, and the remainder of the term loan is being used to reprice an existing $1.67 billion term loan B from Libor plus 375 bps with a 1.25% Libor floor.

Existing lenders are getting paid out at 101 with the repricing due to the current call protection.

Closing is expected this month, subject to market and other customary conditions.

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

Huntsman starts trading

Huntsman's $225 million add-on term loan B (Ba1/BB+) due 2017 freed up for trading too, with levels quoted at par ½ bid, 101 offered, according to a trader.

Pricing on the add-on, as well as on the existing $637 million extended term loan B, is Libor plus 250 bps. The debt was sold at an original issue discount of 991/2.

Recently, the add-on was upsized from $200 million and the discount finalized at the tight end of the 99 to 99½ guidance.

J.P. Morgan Securities LLC is the lead bank on the deal that will be used to refinance an existing $193 million non-extended term loan B due 2014 priced at Libor plus 150 bps. The funds from the upsizing will be used for general corporate purposes.

Huntsman is a Salt Lake City-based manufacturer of differentiated organic and inorganic chemical products.

Flexera flexes

Over in the primary, Flexera Software trimmed pricing on its $355 million credit facility (B2) to Libor plus 375 bps from talk of Libor plus 425 bps to 450 bps and revised the original issue discount to 99½ from 99, while keeping the 1.25% Libor floor intact, according to a market source.

The facility consists of a $25 million revolver and a $330 million term loan B.

BMO Capital Markets Corp. is leading the deal that will be used to refinance an existing first- and second-lien credit facility.

Flexera is a Schaumburg, Ill.-based provider of strategic application usage management services for application producers and their enterprise customers.

ISS discloses talk

ISS held a bank meeting on Friday to launch its $300 million term loan B, at which time talk emerged at Libor plus 300 bps to 325 bps with a 1% Libor floor, an original issue discount of 99½ and 101 soft call protection for one year, according to a market source.

The company is also getting a €380 million term loan A, the source said.

Goldman Sachs & Co., Deutsche Bank Securities Inc., Nordea and UBS Securities LLC are leading the deal that will be used to refinance a €600 million second-lien loan due June 30, 2015.

With the new loans, the company is shopping an extension request to push out the maturity by three years its revolver and letter-of-credit facility due Dec. 31, 2014 and its term loan B and acquisition facility due April 30, 2015. Price talk on the extended debt is Euribor plus 400 bps.

ISS seeks amendment

Furthermore, ISS is out with an amendment to its credit facility to reset the annual senior debt covenant, increase the size of certain baskets and permit the refinancing of 2016 notes, EMTN and certain other junior debt with new senior secured debt subject to pro forma senior leverage not exceeding 4.25 times.

The amendment will also increase flexibility to do disposals subject to disposal proceeds being used to repay senior debt if senior leverage is greater than 4.5 times, repay senior or junior debt if senior leverage is less than or equal to 4.5 times, and, be retained by the group if senior leverage is less than or equal to 3.5 times.

In addition, the amendment will allow the company to use initial public offering proceeds and retained excess cash-flow to repay junior debt, subject to a pro forma total leverage test of 3.5 times.

ISS is a Copenhagen-based facilities services company.

Ruby Western pricing

Ruby Western Pipeline also held a bank meeting, and talk on its $500 million senior secured seven-year term loan (Ba2/BB+) emerged at Libor plus 275 bps to 300 bps with a 1% Libor floor, an original issue discount of 99 to 99½ and 101 soft call protection for one year, according to a market source.

Lead banks, Barclays and Credit Suisse Securities (USA) LLC, are seeking commitments by noon ET on March 22, the source said.

Proceeds will be used to fund a distribution to the sponsors and a six-month debt service reserve.

Leverage is 5.5 times net cash flow available for debt service, the source added.

Ruby Western Pipeline is a holding company with a 50% ownership of the Western US FERC-regulated Ruby Pipeline from Wyoming to Oregon that is a joint venture with Kinder Morgan.

California Pizza OID

California Pizza Kitchen launched with a bank meeting in the morning its $350 million credit facility with original issue discount guidance of 991/2, according to a market source.

Price talk on the deal, which includes a $30 million revolver and a $320 million term loan, emerged prior to launch at Libor plus 450 bps to 475 bps with a 1.25% Libor floor.

The term loan has 101 soft call protection for six months.

GE Capital Markets and Jefferies Finance LLC are leading the facility that will be used to refinance existing first- and second-lien debt.

California Pizza Kitchen is a Playa Vista, Calif.-based casual dining chain and a distributor of frozen food products.

Atkins readies deal

Atkins Nutritionals set a bank meeting for 1:30 p.m. ET in New York on Monday to launch a $425 million credit facility that is being led by Credit Suisse Securities (USA) LLC, according to a market source.

The facility consists of a $20 million revolver (B1/B-), a $280 million six-year first-lien term loan (B1/B-) and a $125 million 61/2-year second-lien term loan (Caa1/CCC), the source said.

The first-lien term loan is talked at Libor plus 500 bps with a 1.25% Libor floor, an original issue discount of 99 and 101 soft call protection for one year.

And, the second-lien term loan is talked at Libor plus 850 bps with a 1.25% Libor floor, a discount of 98 and call protection of 103 in year one, 102 in year two and 101 in year three, the source added.

Proceeds will be used to refinance existing debt and fund a dividend.

Atkins is a Denver-based weight management brand.

Noranda closes

In other news, Noranda Aluminum Acquisition Corp. closed on its $110 million incremental secured term loan (Ba3/B), according to a news release.

Pricing on the loan is Libor plus 450 bps with a 1.25% Libor floor, and it was sold at an original issue discount of 991/2.

During syndication, the add-on was upsized from $60 million and pricing was increased from talk of Libor plus 375 bps to 400 bps.

Bank of America Merrill Lynch led the deal that was used with $225 million of notes to redeem senior floating-rate notes due 2015 and for general corporate purposes.

Noranda is a Franklin, Tenn.-based producer of value-added primary aluminum products and rolled aluminum coils.

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