Sears, AWAS Finance break; Surgery Center tweaks deal; Diebold, Huntsman reveal price talk

By Sara Rosenberg

New York, March 18 – Sears Holdings Corp.’s ABL term loan made its way into the secondary market on Friday, where the debt was seen trading above its original issue discount, and AWAS Finance’s extended term loan freed up as well.

Shifting to the primary market, Surgery Center Holdings Inc. (Surgery Partners Inc.) made a minor technical change to its term loan and extended the commitment deadline.

Also, Diebold Inc. released price talk on its term loan B in connection with its New York bank meeting, Huntsman International LLC disclosed talk on its refinancing transaction with launch and Global Payments Inc. joined the near-term new issue calendar.

Sears starts trading

Sears’ $750 million incremental senior secured ABL term loan (B) due July 20, 2020 freed up for trading on Friday, with levels quoted at 98 bid, 99 offered, according to a trader.

Pricing on the term loan is Libor plus 750 basis points with a 1% Libor floor and it was sold at an original issue discount of 97. The debt includes hard call protection of 102 in year one and 101 in year two.

During syndication the spread on the term loan was reduced from Libor plus 800 bps and the discount firmed at the tight end of the 96 to 97 talk.

Bank of America Merrill Lynch and Wells Fargo Securities LLC are leading the loan that will be used to reduce borrowings under the company’s asset-based revolver.

The borrowers are Sears Roebuck Acceptance Corp. and Kmart Corp.

Closing is targeted for April 8.

Sears is a Hoffman Estates, Ill.-based retailer.

AWAS hits secondary

AWAS Finance’s extended roughly $235 million term loan (Ba2/BBB) due June 2018 also broke, with levels seen at 99 7/8 bid, par 3/8 offered, a trader said.

Pricing on the extended term loan is Libor plus 325 bps with a 0.75% Libor floor and it was sold at an original issue discount of 99.5. The debt has 101 soft call protection for six months.

Recently, pricing on the extended loan firmed at the low end of the Libor plus 325 bps to 350 bps talk and the discount was modified from 99.25.

The term loan is being extended from June 2016 and pricing on the extended amount is being increased from the current rate of Libor plus 275 bps with a 0.75% Libor floor.

RBC Capital Markets is leading the transaction for the Dublin-based aircraft leasing company.

Surgery Center updated

Moving to the primary market, Surgery Center made a slight update to its $80 million incremental covenant-light first-lien term loan due Nov. 3, 2020 in connection with news that the company will be coming to market shortly with a $400 million five-year senior notes offering, according to a market source.

The update was made because permitted indebtedness for a refinancing had to be the same maturity as the company’s existing second-lien term loan. The bonds “will be inside by four months”, the source said.

In connection with the bond deal announcement and the tweak to the loan, the commitment deadline on the incremental term loan was extended to 4 p.m. ET on Monday from Friday, the source said.

As before, the incremental term loan is talked at Libor plus 425 bps with a 1% Libor floor, in line with the existing first-lien term loan due Nov. 3, 2020, and an original issue discount of 98. All of the first-lien term debt will get 101 soft call protection for six months.

Jefferies Finance LLC is leading the loan that will be used to fund two acquisitions.

Proceeds from the bond offering will be used by the Nashville, Tenn.-based healthcare services company to repay second-lien debt and revolver borrowings, and for general corporate purposes.

Diebold talk emerges

Diebold held its New York bank meeting on Friday, and talk on its $1.3 billion equivalent seven-year covenant-light term loan B (Ba2/BB-) surfaced at Libor/Euribor plus 450 bps to 475 bps with a 0.75% floor, an original issue discount of 98.5 and 101 soft call protection for one year, according to a source.

The term loan B is divided into a $1.1 billion U.S. tranche and a $200 million equivalent euro-denominated tranche.

A bank meeting for European investors took place in London on Thursday.

Commitments are due on March 31, the source said.

J.P. Morgan Securities LLC and Credit Suisse Securities (USA) LLC are leading the deal.

Diebold funding acquisition

Proceeds from Diebold’s term loan B and $500 million of notes will be used to help fund the acquisition of Wincor Nixdorf AG for €38.98 in cash plus 0.434 of a Diebold common share per share. This transaction values Wincor, including net debt, at about $1.8 billion.

Diebold is a North Canton, Ohio-based provider of self-service delivery, value-added services and software primarily to the financial industry. Wincor is a Paderborn, Germany-based provider of IT solutions and services to retail banks and the retail industry.

After closing, the combined company will be named Diebold Nixdorf and will be operated from headquarters in North Canton, Ohio, and Paderborn, Germany.

Huntsman sets guidance

Huntsman held its lender call in the morning, launching its $550 million seven-year senior secured term loan B with talk of Libor plus 350 bps with a 0.75% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, a market source remarked.

Commitments are due at noon ET on March 24.

Citigroup Global Markets Inc. is the lead arranger on the deal and J.P. Morgan Securities LLC is the administrative agent.

Proceeds will be used to refinance a term loan B due in 2017 and a term loan C due in 2016.

Closing is targeted for the end of this month, the source said.

Huntsman is a the Woodlands, Texas-based manufacturer and marketer of differentiated chemicals.

Global Payments on deck

Global Payments emerged with plans to hold a bank meeting on Monday to launch a $1,045,000,000 term loan B (Ba2/BBB-), according to market sources.

Bank of America Merrill Lynch, MUFG, PNC Capital Markets LLC, TD Securities (USA) LLC, SunTrust Robinson Humphrey Inc., Fifth Third Bank, Barclays and Capital One are leading the debt that will help fund the acquisition of Heartland Payment Systems Inc. in a cash-and-stock transaction for $100 per share, representing a transaction value of about $4.3 billion. Consideration for the transaction will consist of 0.6687 of a share of Global Payments stock and $53.28 for each share of Heartland stock at closing.

Closing is expected in Global Payments’ fiscal 2016 fourth quarter, subject to regulatory approval and customary conditions, as well as approval by Heartland’s shareholders.

Global Payments is an Atlanta-based provider of payment technology services. Heartland is a Princeton, N.J.-based payment processor.

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