ReAble breaks; TD Ameritrade slides; LCDX rises with equities; Florida East Coast sets talk

By Sara Rosenberg

New York, Nov. 13 - ReAble Therapeutics Inc.'s credit facility freed up for trading on Tuesday, with the term loan B quoted right around its original issue discount level, and TD Ameritrade Holding Corp.'s term loan B faltered on the heels of E*Trade Financial Corp.'s announcement of expected write-downs.

Also in trading, LCDX was stronger in a relatively quiet secondary market as stocks rallied, and although the cash market was stronger as well, names like First Data Corp. and Texas Competitive Electric Holdings Co. LLC (TXU) came in a little bit on some selling pressure.

Meanwhile, in the primary, Florida East Coast Industries, Inc. came out with price talk on its credit facility as the deal was launched to investors during the session.

ReAble Therapeutics' credit facility allocated and freed up for trading on Tuesday, with the $1.055 billion 61/2-year term loan B quoted at 99 bid, 99¼ offered, according to a trader.

The term loan B is priced at Libor plus 300 basis points and was sold at an original issue discount of 99.

ReAble's $1.155 billion senior secured credit facility (Ba3/BB-) also includes a $100 million six-year revolver that is priced at Libor plus 300 bps, with a 50 bps commitment fee.

When details on the deal first emerged in July, it was said in filings with the Securities and Exchange Commission that both tranches would carry pricing of Libor plus 250 bps.

Credit Suisse and Bank of America are the lead banks on the deal.

Proceeds will be used to help fund the acquisition of DJO Inc. for $50.25 per share in cash. The transaction is valued at $1.6 billion, including the assumption of debt.

Other acquisition financing will come from $575 million of senior notes and equity from the Blackstone Group, which is the controlling shareholder of ReAble.

ReAble is an Austin, Texas, medical device company focused on rehabilitation, pain management, physical therapy and orthopedics. DJO is a Vista, Calif., provider of products and services that promote musculoskeletal and vascular health.

TD Ameritrade lower on E*Trade negativity

TD Ameritrade's term loan B headed down on Tuesday in reaction to E*Trade's recent announcement regarding exposures and write-downs, according to a trader.

The term loan B ended the day at 97½ bid, 98¼ offered, down from previous levels of 98 bid, 99 offered, the trader said.

"E*Trade disclosed a lot of subprime exposure and an analyst came out and said there might be a risk of bankruptcy. It made people worry about TD Ameritrade," the trader explained.

Late in the day Friday, E*Trade announced that it has observed continued declines in the fair value of its $3 billion asset-backed securities portfolio, predominantly within ABS CDO and second-lien securities.

At Sept. 30, the total exposure to ABS CDO and second-lien securities was approximately $450 million in amortized cost, including approximately $50 million of AAA rated asset-backed CDOs that were downgraded to below investment grade.

E*Trade went on to say that it anticipates the declines in fair value to result in further securities write-downs in the fourth quarter, so investors should no longer expect previous 2007 earnings estimates to be achieved.

E*Trade is a New York-based provider of financial services including trading, investing, banking and lending for retail and institutional customers.

TD Ameritrade is an Omaha-based provider of securities brokerage services and technology-based financial services to retail investors and business partners.

LCDX up with stocks

LCDX 9 gained some ground on Tuesday in sympathy with stocks during a trading session that saw light volume coming off the holiday weekend, according to a trader.

The index went out at 96.45 bid, 96.60 offered, up from Friday's levels of 96.20 bid, 96.30 offered, the trader said.

As for equities, Nasdaq closed up 89.52 points, or 3.46%, Dow Jones Industrial Average closed up 319.54 points, or 2.46%, S&P 500 closed up 41.87 points, or 2.91%, and NYSE closed up 291.01 points, or 3.04%.

First Data, TXU soften

In more trading news, First Data and Texas Competitive both saw their term loans weaken despite the general positive tone that was seen in the secondary as a result of market technicals, according to a trader.

"The big loans were weighed down by a little bit of selling pressure. Overall the market started off a bit weaker but closed up about an eighth for the day, following the huge rally in equities," the trader remarked.

First Data's term loan B-2 ended the day at 95 3/8 bid, 95 5/8 offered, down about an eighth of a point from Friday, the trader said.

And, Texas Competitive's term loan B-2 and term loan B-3 were both down about an eighth of a point as well, with the term loan B-2 ending the day at 98¼ bid, 98½ offered and the term loan B-3 ending the day at 98 3/8 bid, 98 5/8 offered, the trader added.

First Data is a Greenwood Village, Colo., provider of electronic commerce and payment services for businesses. Texas Competitive is a Dallas-based energy company.

Florida East Coast price talk

Moving to the primary market, Florida East Coast Industries held a conference call on Tuesday to kick off syndication on its $1.656 billion 18-month credit facility, and in connection with the launch, price talk was announced, according to a market source.

All tranches under the facility were presented to lenders with talk of Libor plus 225 bps, with a step up to Libor plus 250 bps in May 2008, the source said.

In addition, all tranches are being offered with an original issue discount in the 98 area, the source continued.

Tranching on the deal is comprised of a $50 million revolver, a $13.25 million delayed-draw term loan, a $992.75 million "property" term loan B and a $600 million "rail" term loan B.

The facility has a six-month extension option.

Citigroup and Bear Stearns are the lead banks on the credit facility, with Citi the left lead.

The deal was originally expected to launch this past Thursday, but was pushed off a few days because of scheduling conflicts.

Proceeds will be used to back the already completed buyout of the company by Fortress Investment Group LLC.

Florida East Coast Industries is a Jacksonville, Fla., company that operates through two distinct businesses: Flagler Development Group, its commercial real estate operation, and Florida East Coast Railway LLC.

RCN OID emerges

RCN Corp.'s $200 million term loan B add-on (B1) is being talked with an original issue discount that is in the 96½ area, according to a market source.

The add-on, which launched with a conference call this past Thursday, is priced at Libor plus 225 bps, in line with existing term loan B pricing.

At the time of the launch, the original issue discount was labeled as still to be determined.

Deutsche Bank is the lead bank on the deal, which is being used to help fund the already completed acquisition of NEON Communications Group Inc. for $5.15 per share, or an aggregate purchase price of $255 million.

Other financing came from a draw of about $25 million under the company's existing revolver and cash on hand.

In connection with this term loan B add-on, a secured leverage covenant is being added to RCN's credit facility, which will apply to both the new and existing loans.

Pro forma for the transaction, debt to EBITDA is 4.5 times and net debt to EBITDA is 4.2 times.

RCN is a Herndon, Va.-based provider of video, data and voice services. NEON is a Westborough, Mass., facilities-based wholesale communications provider.

Nuveen closes

Madison Dearborn Partners, LLC completed its buyout of Nuveen Investments Inc. for $65.00 per share in cash, for a total transaction that was valued at $6.3 billion, including existing debt of $550 million, according to a news release.

To help fund the buyout, Nuveen got a new $2.565 billion senior secured credit facility (Ba3/BB-) consisting of a $250 million six-year revolver and a $2.315 billion seven-year term loan B, with both tranches priced at Libor plus 300 bps.

The term loan B was sold to investors at an original issue discount of 99 and carries 101 soft call protection for one year.

During syndication, the term loan B was upsized from $2.215 billion after the company's bond offering was downsized to $785 million from $885 million, and the discount on the paper tightened from initial talk that was in the 98½ area.

Deutsche Bank and Wachovia acted as the joint lead arrangers on the deal, and Merrill Lynch and Morgan Stanley acted as co-lead arrangers. All four banks acted as bookrunners.

Nuveen is a Chicago-based provider of investment services.

Susser closes

Susser Holdings Corp. closed on its $195 million senior secured credit facility, according to a company news release.

The facility consists of a $90 million revolver and a $105 million term loan that is priced at Libor plus 250 bps.

Bank of America, Merrill Lynch, Wachovia and BMO acted as the lead banks on the deal.

Proceeds from the credit facility, along with $150 million in 10 5/8% senior notes, were used to help fund the acquisition of Town & Country Food Stores and to refinance existing debt.

Pro forma for the transaction, debt to EBITDA is 4.1 times and adjusted EBITDA to interest expense is 2.4 times.

Susser bought Town & Country in an all-cash transaction valued at approximately $359 million, plus payment of a $6 million tax benefit.

The term loan is secured primarily by Town & Country's real estate.

Corpus Christi, Texas-based Susser and San Angelo, Texas-based Town & Country are both convenience store operators.

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