MGM Resorts up with bond offering; Taminco, CCS, Encompass Digital float price talk

By Sara Rosenberg

New York, Jan. 11 - MGM Resorts International's term loans were a little stronger in the secondary market on Wednesday as the company announced a new bond deal, and Supervalu Inc.'s loans held firm despite the release of disappointing numbers.

Over in the primary market, Taminco Group Holdings disclosed tranching and price talk on its credit facility, and CCS Corp. outlined guidance on its add-on term loan as both deals were launched to lenders during the session.

Additionally, Encompass Digital Media Inc. released details on the size, structure and pricing on its credit facility as a bank meeting date has been set, Generac Power Systems Inc. firmed up timing on the launch of its refinancing deal, and CKx Inc. surfaced with new loan plans.

MGM Resorts strengthens

MGM Resorts' term loan C and term loan E were better in trading on Wednesday after news of a senior unsecured notes offering hit the market, according to traders.

Both term loans were quoted by one trader at 98¾ bid, 99 3/8 offered, up from 98½ bid, 99 offered. Meanwhile, a second trader had the term loan C quoted at 99 bid, 99½ offered, up from 98 5/8 bid, 99 1/8 offered.

Proceeds from the new $850 million bond deal that was upsized from $500 million and priced at par to yield 8.625% will be used to repay some borrowings under the company's senior credit facility or outstanding debt securities.

The trader remarked that investors don't seem to be expecting the paydown to go towards the term loans, but whatever bank debt is taken out will create a better credit environment for the company.

MGM Resorts is a Las Vegas-based owner and operator of casino resorts.

Supervalu steady

Supervalu's term loans remained firm even though the company released quarterly results that showed year-over year declines in earnings and sales, according to traders.

One trader had the term loan B-1 at par bid, par ¼ offered and the term loan B-2 at 98 bid, 99 offered - both flat on the day. A second trader was seeing the B-1 at the same level, the B-2 at 98 1/8 bid, 98 7/8 offered and the B-3 at 98 7/8 bid, 99 5/8 offered, and he believed all of the debt to be unchanged on the day as well.

For the third fiscal quarter of 2012, Supervalu reported a net loss of $750 million, or $3.54 per diluted share, versus a net loss of $202 million, or $0.95 per diluted share, in the prior year.

Net sales were $8.3 billion, down from $8.7 billion in the third quarter of fiscal 2011.

And, year-to-date net cash flows from operating activities were $518 million, compared to $651 million in the previous year.

Supervalu is an Eden Prairie, Minn.-based supermarket operator.

Taminco structure, talk

Moving to the new deal front, Taminco held its bank meeting on Wednesday afternoon, and in connection with the event, tranching as well as price talk were announced, according to a market source.

The facility was launched as a $198 million five-year U.S./euro revolver and a $452 million seven-year covenant-light term loan B, the source said.

Price talk on the B loan is in the Libor plus 525 basis points area with a 1.25% Libor floor and an original issue discount of 97, the source continued.

The revolver has a 50 bps unused fee and a maximum net first-lien leverage covenant.

Lead banks Citigroup Global Markets Inc., Nomura, Credit Suisse Securities (USA) LLC, UBS Securities LLC, Deutsche Bank Securities Inc. and Goldman Sachs & Co. are seeking commitments towards the $650 million credit facility by Jan. 24.

Taminco funding buyout

Proceeds from Taminco's credit facility, $452 million of high-yield notes and about 40% equity will be used to fund the purchase of the company by Apollo Global Management LLC from CVC Capital Partners for about €1.1 billion.

Prior to launch, there was chatter that the credit facility and bond commitment totaled around €720 million. The financing was committed to in euros but is being issued in dollars.

Closing on the transaction is expected in mid-February, subject to customary conditions.

Taminco is a Belgium-based producer of alkylamines and their derivatives.

CCS releases guidance

CCS revealed price talk of Libor plus 500 bps with a 1.5% Libor floor and an original issue discount of 98 on its C$200 million add-on term loan due November 2014 that was launched with a call in the afternoon, according to a market source.

Lenders are being asked to get their commitments in by Jan. 18.

Deutsche Bank Securities Inc. and Goldman Sachs & Co. are the lead banks on the deal that will be used to refinance revolver borrowings.

CCS is a Calgary, Alta.-based oil and gas environmental services company.

Encompass details surface

Encompass Digital Media will be holding a bank meeting at 10 a.m. ET on Jan. 18 to launch its proposed credit facility, which has been revealed to be $280 million in total size and talked at Libor plus 650 bps with a 1.5% Libor floor, according to a market source.

The facility consists of a $30 million five-year revolver and a $250 million 51/2-year term loan B, the source said. The B loan is being offered with an original issue discount of 97, the source remarked.

Plans for the new credit facility were announced late last year, but structure was not available and timing was simply labeled as mid-January business.

Macquarie Capital is the lead arranger and bookrunner on the deal, and BMO Capital Markets Corp. has signed on as a bookrunner as well.

Encompass being acquired

Proceeds from Encompass' new credit facility, along with just shy of $250 million of rollover and new equity, will be used to fund its buyout by Court Square Capital Partners from Wasserstein & Co. LP.

Total and senior leverage is 4.25 times off of run rate EBITDA.

Closing is expected to occur this quarter, subject to regulatory clearances and the transfer of certain FCC licenses.

In 2011, the company got a $195 million senior secured credit facility via Macquarie for the acquisition of the content distribution business of Ascent Media Corp. that consisted of a $175 million term loan B and a $20 million revolver. Both tranches priced at Libor plus 600 bps with a 1.75% Libor floor and were sold at an original issue discount of 98.

Encompass is a Los Angeles-based digital media services provider.

Generac reveals timing

Generac Power Systems came out with a bank meeting date for its recently announced senior secured credit facility (Ba3/BB+), setting the launch for 2 p.m. ET on Tuesday in Chicago, according to a market source.

The facility includes a revolver, a term loan A and a term loan B, with sizes not yet available the source said. However, Moody's Investors Service and Standard & Poor's have outlined the total credit facility size at $725 million, and Moody's said the deal would have a $150 million revolver and $575 million of term loans.

J.P. Morgan Securities LLC and Goldman Sachs & Co. are leading the deal that will be used to refinance an existing credit facility and for other general corporate purposes.

Generac is a Waukesha, Wis.-based designer and manufacturer of generators and other engine powered products.

CKx coming soon

CKx scheduled a bank meeting for Tuesday morning to launch a $200 million first-lien 51/2-year term loan that is being led by Goldman Sachs & Co. and Macquarie Capital, according to a market source.

Proceeds will be used to take out some of the debt financing that was used to fund the purchase of the company last year by Apollo Global Management.

CKx is a New York-based owner of entertainment content.

Steel Dynamics wraps

In other news, Steel Dynamics Inc. completed its $275 million term loan due Sept. 30, 2016 that was downsized from $315 million term loan, according to a market source.

Pricing on the loan is Libor plus 150 bps.

Bank of America Merrill Lynch, PNC Capital Markets LLC and Wells Fargo Securities LLC acted as the joint bookrunners and lead arrangers on the deal that was syndicated to banks.

Proceeds will be used to fund the repurchase of about $278 million of the company's 7 3/8% senior notes due 2012 that were tendered by the early tender deadline.

The company launched the tender offer for up to $350 million of its notes last month, and it expires on Jan. 25.

Steel Dynamics is a Fort Wayne, Ind.-based manufacturer and seller of steel products.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.