TXU, Metavante, Centaur break; Chrysler may restructure; Nuveen upsizes; ReAble, Basell set talk

By Sara Rosenberg

New York, Oct. 31 - Texas Competitive Electric Holdings Co. LLC (TXU) allocated its term loan B-3 on Wednesday, with the debt then freeing for trading atop par, and Metavante Corp. and Centaur LLC saw their credit facilities break for trading as well.

In other news, talk is that when Chrysler Corp. LLC (Chrysler Auto) brings its first-lien term loan debt to market, which is expected to happen soon, the structure on the deal could vary from that with which it was funded.

Also in the primary, Nuveen Investments Inc. upsized its term loan B while reducing the original issue discount, ReAble Therapeutics Inc. spread guidance emerged as the deal was launched with a bank meeting Wednesday, and Basell talk surfaced as it was launched to senior managing agents.

And, price talk on Marsico Capital Management LLC and PPG Auto Glass also came out as both deals are getting ready to launch with bank meetings next week.

Texas Competitive Electric Holdings allocated its entire $6 billion seven-year term loan B-3 on Wednesday afternoon and then freed the paper up for trading, with levels quoted at par 1/16 bid, par 3/16 offered, according to a trader.

The term loan B-3 is priced at Libor plus 350 bps, was sold at par, and is non-callable for three years.

On Monday, the loan syndicate opened the term loan B-3 up for syndication, saying that they were taking orders on a minimum $3 billion portion of the loan, with the final allocation amount subject to market demand. Commitments were due on Tuesday at 3 p.m. ET.

There were just under 200 accounts in the book, with a good portion of term loan B-2 investors rolling over and some new investors participating as well, the trader said.

Texas Competitive's $7 billion seven-year term loan B-2, which wrapped up syndication last week and broke for trading at that time, was quoted on Wednesday at 99 7/8 bid, par offered, unchanged from Tuesday's closing levels.

Citigroup, JPMorgan, Goldman Sachs, Lehman Brothers, Morgan Stanley and Credit Suisse are the joint lead arrangers and bookrunners on the deal, with Citi the administrative agent, JPMorgan the syndication agent, and Credit Suisse, Goldman, Lehman and Morgan Stanley the co-documentation agents.

Proceeds from the credit facility were used to help fund the recently completed leveraged buyout of TXU Corp., a Dallas-based energy company, by an investor group led by Kohlberg Kravis Roberts & Co. and Texas Pacific Group for $69.25 per share. The transaction was valued at $45 billion.

Metavante frees to trade

Metavante's credit facility also hit the secondary market on Wednesday, with the $1.75 billion seven-year term loan quoted at 97½ bid, 98 offered on the break and then moving up to 97¾ bid, 98 offered, where it closed the day, according to a market source.

The term loan is priced at Libor plus 175 bps, with a single step down based on the company meeting a leverage test., and was sold to investors at an original issue discount of 971/2.

Metavante's $2 billion senior secured credit facility (Ba2/BB) also includes a $250 million six-year revolver priced at Libor plus 162.5 bps, with a 50 bps commitment fee.

There is a $350 million accordion feature. If the interest rate applicable to any incremental facility is more than 25 bps higher than the term loan pricing, then the term loan pricing will be increased so that it is 25 bps lower than the incremental pricing.

The credit facility contains a consolidated leverage ratio that opens at 5 to 1 and slides down to 3.5 to 1 over time. The covenant will apply starting with the fiscal quarter ending March 31, 2008.

JPMorgan, Morgan Stanley, Lehman Brothers and Robert W. Baird & Co. are the lead banks on the deal.

Proceeds will be used to help fund the company's spinoff from Marshall & Ilsley Corp.

Under the spinoff, Marshall & Ilsley shareholders will receive one share of Marshall & Ilsley stock as well as one share of Metavante stock for every three shares of Marshall & Ilsley stock held.

In addition, Warburg Pincus, a private equity investor, will invest $625 million to obtain a 25% equity stake in Metavante.

The spinoff was approved by shareholders at a special meeting held on Oct. 25, and closing is anticipated to take place on Nov. 1.

Metavante is a provider of banking and payments technologies.

Centaur breaks

Another deal to free for trading during market hours was Centaur, with its strip of funded and delayed-draw first-lien term loan debt quoted at 99 bid, 99½ offered, according to a trader.

The $420 million five-year funded first-lien term loan (B1/BB-) and the $100 million one-year delayed-draw term loan (B1/BB-) are both priced at Libor plus 400 bps and were both sold at a discount of 98.

During syndication, the funded first-lien loan was downsized from $455 million.

Centaur's $775 million credit facility also includes a $25 million five-year revolver (B1/BB-) priced at Libor plus 400 bps, with a 75 bps commitment fee, a $50 million letter-of-credit facility (B1/BB-) priced at Libor plus 400 bps and a $180 million six-year second-lien term loan (Caa1/B-) priced at Libor plus 750 bps.

The revolver and second-lien term loan were both sold at a discount of 98.

During syndication, the second-lien loan was upsized from $130 million when the first-lien term loan was downsized, and pricing was reverse flexed from Libor plus 800 bps.

Credit Suisse is the lead bank on the deal that is being used to fund the development of racino facilities in greater Indianapolis and Western, Pa.

Centaur is an Indiana-based gaming and horseracing company.

Chrysler Auto structure could change

Moving to the primary, Chrysler Auto is anticipated by market players to launch its $10 billion in first-lien term loan debt with different tranching than the first-out, second-out structure that was seen at funding.

As currently documented, the loan is structured as a $5 billion first-out term loan (Ba3/BB-) and a $5 billion second-out term loan (B3/B).

"That is the structure [they] funded the deal with, but I do not think that will be the final structure when the deal is re-launched," one source told Prospect News on Wednesday.

And, a second source agreed with that notion saying that "the structure could change."

No official word on structure is available as of yet, both sources said.

The deal is targeted to launch with a bank meeting on Nov. 7; however, firm timing has not yet been announced, sources added.

JPMorgan, Goldman Sachs, Citigroup, Bear Stearns and Morgan Stanley are the lead banks on the deal, with JPMorgan, Goldman and Citigroup the joint lead arrangers.

The term loan debt was funded this summer by the lead banks to help finance the acquisition of a majority interest in the company by Cerberus Capital Management, LP from DaimlerChrysler AG.

Before being postponed in late July because of market conditions, the term loan B was structured as one tranche that was guided at Libor plus 375 bps, after flexing up from original talk at launch of Libor plus 325 bps, and was non-callable for one year then at 101 in year two.

Chrysler Auto also got a $2 billion delayed-draw seven-year second-lien term loan that was funded by Cerberus, who took down $500 million, and DaimlerChrysler, who took down $1.5 billion.

The second-lien term loan is delayed-draw for 12 months and must fund after that time. Originally, the tranche was expected to be funded at close.

The second-lien term loan will definitely not come back for broad syndication for at least a year from close.

Before being taken out of market, the second-lien term loan was being talked at Libor plus 700 bps, up from original talk of Libor plus 600 bps, with call protection of non-callable for one year, then at 103 in year two and 101 in year three.

Chrysler Auto is a producer and seller of Chrysler, Dodge and Jeep vehicles.

Nuveen ups B loan size, cuts OID

Nuveen Investments made some changes to its credit facility on Wednesday, including upsizing its term loan B due to an equivalent downsizing in the company's bond deal, and reducing the original issue discount on the term loan B, according to a market source.

The seven-year term loan B is now sized at $2.315 billion, up from $2.215 billion, and the bond offering is now sized at $785 million, down from $885 million, the source said.

And, the original issue discount on the term loan B was changed to 99 from previous guidance that was in the 98½ area, the source remarked.

Pricing on the term loan B remained in line with initial talk at Libor plus 300 bps and the tranche still carries 101 soft call protection for one year.

The company's now $2.565 billion (up from $2.465 billion) senior secured credit facility (Ba2/BB-) also includes a $250 million six-year revolver priced at Libor plus 300 bps.

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

Proceeds will be used to help fund the leveraged buyout of the company by Madison Dearborn Partners, LLC for $65.00 per share in cash. The total transaction is valued at $6.3 billion, including existing debt of $550 million.

Nuveen is a Chicago-based provider of investment services.

ReAble sets talk

ReAble held a bank meeting on Wednesday to kick off syndication on its $1.155 billion senior secured credit facility (Ba3/BB-), and in connection with the launch, price talk was announced, according to a market source.

Both the $1.055 billion 61/2-year term loan B and the $100 million six-year revolver were presented to lenders with talk of Libor plus 300 bps, the source said.

The term loan B is being offered to investors at an original issue discount of 99, the source added.

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

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.

Basell spreads emerge

Basell revealed pricing guidance and tranching details on its $14.6 billion senior secured credit facility as the deal was presented to senior managing agents with a bank meeting in New York on Wednesday, according to a market source.

The $1 billion cash flow revolver is being talked at Libor plus 300 bps, with a 75 bps undrawn fee, the $2 billion U.S. and euro term loan A is being talked at Libor plus 300 bps, the $9.45 billion U.S. and euro term loan B is being talked at Libor plus 325 bps, the $1.15 billion ABL receivables purchase program facility is being talked at Libor plus 150 bps and the $1 billion inventory based facility is being talked at Libor plus 175 bps, the source said.

The term loan B is being offered at an original issue discount of 99, the source added.

Covenants under the cash flow revolver, term loan A and term loan B include a first-lien senior secured leverage ratio of 3.75 times and a fixed charge coverage ratio of 1.1 times.

The deal was already launched to European senior managing agents with a meeting in London this past Tuesday. A retails bank meeting for the deal is expected to take place during the week of Nov. 26.

Citigroup, Goldman Sachs, Merrill Lynch, ABN Amro and UBS are the joint lead arrangers and joint bookrunners on the deal.

Proceeds will be used to help fund the acquisition of Lyondell Chemical Co. for $48.00 per common share in an all-cash transaction with a total enterprise value of about $19 billion, including the assumption of debt.

Following completion of the merger transaction, the newly combined company will be named LyondellBasell Industries.

Basell is a Netherlands-based producer of polypropylene and polyethylene. Lyondell is a Houston-based chemical company.

Marsico price talk

Marsico announced price talk of Libor plus 300 bps on both tranches under its proposed $1.225 billion credit facility now that timing for a launch has firmed up with the scheduling of a bank meeting for Nov. 7 at 1:30 p.m. ET in New York, according to a market source.

Tranching on the deal, which was previously just labeled as November business, is comprised of a $25 million revolver and a $1.2 billion term loan.

There will be an original issue discount on the term loan but the level is still to be determined, the source added.

Goldman Sachs is the lead bank on the deal that will be used to help fund the buyout of the company by Thomas F. Marsico, founder and chief executive officer, from Bank of America.

Other buyout financing is coming from $1.35 billion of mezzanine financing that Goldman Sachs bought and syndicated to the market.

Marsico Capital Management is a Denver-based equity oriented asset manager.

PPG floats guidance

PPG Auto Glass also came out with price talk on its credit facility as a bank meeting got scheduled for this coming Tuesday at 2 p.m. ET in New York, and details on original issues discounts and call protection surfaced as well.

The company's $225 million first-lien term loan is being talked at Libor plus 400 bps, with an original issue discount of 99 and call protection of 102 in year one and 101 in year two, the source said.

And, the $125 million second-lien term loan is being talked at Libor plus 800 bps, with a discount of 98½ and call protection of 104 in years one and two, 102 in years three and four, and par thereafter, the source added.

The $425 million credit facility also includes a $75 million ABL revolver that has already been placed.

It was previously known that the deal would come sometime in November but a specific date had been unavailable.

Goldman Sachs is the lead bank on the deal.

Proceeds will be used to help fund Platinum Equity's acquisition of PPG Industries' automotive original equipment manufacture glass and automotive replacement glass and services businesses for approximately $500 million before minority interest.

PPG Auto Glass is a supplier of windshields, rear and side windows, sunroofs and assemblies for auto and truck manufacturers, a supplier and distributor of replacement automotive glass products for use in the aftermarket, and a provider of insurance claim services, glass management software and e-business solutions.

Telesat closes

A joint venture company formed by Loral Space & Communications Inc. and the Public Sector Pension Investment Board completed its acquisition of Telesat Canada for C$3.25 billion, according to a news release.

To help fund the transaction, Telesat got a new approximately $2.25 billion credit facility (B1/BB-), consisting of a C$160 million five-year revolver, a $169 million five-year term loan A, a $1.764 billion seven-year term loan B and a $150 million delayed-draw term loan B.

The funded and delayed-draw term loan B are priced at Libor plus 300 bps and were sold at a discount of 98.

During syndication, the funded term loan B was upsized from $1.44 billion, the term loan A was downsized from around $469 million, and the discount on the funded and delayed-draw term loan B's firmed up from original guidance in the 97½ to 98 range.

There are maintenance covenants under the facility.

Morgan Stanley, UBS and JPMorgan acted as the lead arrangers and bookrunners on the deal, with Morgan Stanley and UBS senior lead arrangers and Morgan Stanley on the left. Morgan Stanley is administrative agent on the credit facility, UBS is syndication agent and Bank of Nova Scotia, JPMorgan and Citigroup are joint documentation agents.

Telesat is an Ottawa operator of telecommunications satellites.

General Cable closes

General Cable Corp. closed on its $100 million ABL revolver add-on that brought the facility to a new total size of $400 million, according to a company news release.

Merrill Lynch Capital Corp. acted as the lead bank on the deal.

The increase was done in connection with the company's acquisition of Freeport-McMoRan Copper & Gold Inc.'s wire and cable business.

General Cable is a Highland Heights, Ky., maker of copper, aluminum and fiber optic wire and cable products.

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