Vertafore, GEO, Universal Health break; Las Vegas Sands rallies; TI Auto, Savvis tweak deals

By Sara Rosenberg

New York, July 28 - Vertafore Inc., GEO Group Inc. and Universal Health Services Inc. all saw their credit facilities free up fro trading on Wednesday, and Las Vegas Sands Corp.'s strip of institutional bank debt strengthened with news of an amend and extend as well as earnings.

In addition, a Bid Wanted In Competition (BWIC) surfaced, and initially it was thought to be sized at $122 million, but it was later increased to $136 million as a few names were added to the portfolio.

Over in the primary market, TI Automotive is getting ready to relaunch its proposed term loan with revised terms that include a smaller size, higher pricing, juicier call premiums and added collateral.

Also, Savvis Inc. changed pricing on its term loan and firmed the original issue discount, Allscripts increased its pro rata tranches and cut pricing, Ferro Corp. is getting ready to bring its proposed revolver to market, and Tomkins plc is planning on launching a large new deal after Labor Day.

In other news, Nielsen Co. revised its extension proposal, offering a shorter maturity and higher pricing, and on the back of the news, the company's tranche A term loan was stronger in the secondary market.

Vertafore frees to trade

Vertafore's credit facility began trading on Wednesday, with the $550 million term loan quoted at 98¾ bid, 99¾ offered on the break and then moving up to 99¼ bid, 99¾ offered, according to a one trader, and to 99¼ bid, par offered, according to a second trader.

Pricing on the term loan is Libor plus 500 basis points with a 1.75% Libor floor, and it was sold at an original issue discount of 98.

During syndication, pricing on the term loan was reduced from Libor plus 525 bps, and the discount firmed at the low end of the initial 97 to 98 talk.

The company's $625 million senior credit facility (B1/B+) also includes a $75 million revolver that is priced at Libor plus 500 bps - after flexing down from Libor plus 525 bps - with a 1.75% Libor floor as well.

Vertafore being acquired

Proceeds from Vertafore's credit facility, along with $240 million of junior debt and equity, will be used to help fund the buyout of the company by TPG Capital from Hellman & Friedman and JMI Equity for a total consideration of $1.4 billion.

Credit Suisse, Bank of America and Barclays are the lead banks on the facility, with Credit Suisse the left lead. RBC is a documentation agent.

The acquisition is expected to close in the third quarter, subject to customary regulatory approvals.

Leverage will be 4.5 times through the first lien and 6.5 times total, and the equity contribution is 47%.

Vertafore is a Bothell, Wash.-based provider of software and information to the insurance distribution channel.

GEO Group breaks

Another deal to hit the secondary market was GEO Group, with its $200 million six-year term loan B quoted at 99¾ bid, par ¼ offered on the break and then moving up to par ¼ bid, par ¾ offered, according to traders.

Pricing on the term loan B is Libor plus 325 bps with a 1.5% Libor floor, and it was sold at an original issue discount of 99.

The company's $750 million credit facility (Ba3/BB+) also includes a $400 million five-year revolver and a $150 million five-year delayed-draw term loan A, with both of these tranches priced at Libor plus 250 bps.

The spread on the revolver and the term loan A was flexed down from Libor plus 275 bps during syndication.

GEO Group led by BNP

BNP Paribas is the lead bank on GEO Group's credit facility that will be used to refinance existing debt and to help fund the acquisition of Cornell Cos. Inc. at an estimated enterprise value of $685 million, including the assumption of $300 million of Cornell debt and excluding cash.

Cornell stockholders can choose to receive GEO common stock or cash. In order to preserve the tax-deferred treatment of the transaction, no more than 20% of the outstanding shares of Cornell common stock may be exchanged for cash.

The merger is expected to close in the third quarter.

Boca Raton, Fla.-based GEO Group and Houston-based Cornell are prison operators.

Universal Health starts trading

Also breaking for trading was Universal Health Services' credit facility, with the $1.6 billion term loan B quoted at 99 3/8 bid, 99 7/8 offered, according to a trader.

Pricing on the term loan B is Libor plus 400 bps with a 1.5% Libor floor and an original issue discount of 981/2. The tranche includes 101 soft call protection for one year and a ticking fee of 200 bps until September and 400 bps thereafter.

The company's $3.45 billion senior secured credit facility (Ba2/BB+) also provides for an $800 million revolver priced at Libor plus 325 bps and a $1.05 billion term loan A priced at Libor plus 325 bps.

During syndication, the term loan A was upsized from $1 billion and the term loan B was upsized from $1.55 billion after the company's senior unsecured notes were downsized to $250 million from $400 million.

Universal Health funding acquisition

Proceeds from Universal Health's credit facility and notes will be used to help fund the acquisition of Psychiatric Solutions Inc. for $33.75 per share in cash, refinance existing debt and pay transaction fess and expenses.

JPMorgan and Deutsche Bank are the joint lead arrangers and bookrunners on the facility.

Closing is expected to take place in the fourth quarter, subject to regulatory approvals and approval by Psychiatric Solutions' shareholders.

Universal Health is a King of Prussia, Pa.-based owner and operator of acute care hospitals and behavioral health care facilities and schools. Psychiatric Solutions is a Franklin, Tenn.-based operator of owned or leased freestanding psychiatric inpatient facilities.

Las Vegas Sands rises

Las Vegas Sands' strip of institutional bank debt saw a strong improvement in trading as the company revealed in its earnings call that it will be coming to market with an amend and extend transaction, according to traders.

The strip of debt was quoted by one trader at 92¾ bid, 93½ offered, up from 90¾ bid, 91½ offered, and by a second trader at 93 1/8 bid, 93½ offered, up from 90¾ bid, 91½ offered.

On the earnings call, the company said that it will be launching an amendment and extension to its credit facility on Friday to address its U.S. revolver and term loan maturities, the first trader said.

Furthermore, the company disclosed that there would be some sort of paydown in connection with the deal, the trader continued.

Las Vegas Sands earnings

Also helping Las Vegas Sands' bank debt on Wednesday was the release of strong second-quarter numbers that showed a year-over-year improvement in earnings, revenue and adjusted property EBITDA, the traders remarked.

For the second quarter, the company reported a net loss of $4.7 million, or less than $0.01 per diluted share, compared to net loss of $222.2 million, or $0.34 per diluted share, in the previous year.

Net revenue for the quarter was a record $1.59 billion, an increase of 50.6%, compared to $1.06 billion in the second quarter of 2009.

And, consolidated adjusted property EBITDA in the quarter increased 91.2% to $473.5 million, compared to $247.6 million in the prior year.

Las Vegas Sands may see upgrade

In more Las Vegas Sands news, the company's corporate credit rating of B- was placed on CreditWatch with positive implications by Standard & Poor's.

The rating agency attributed the move to the company's strong second-quarter performance and the proposed amend and extend.

S&P continued to say that it expects the amend and extend to include meaningful debt repayment, an extension of maturities and some covenant modification.

Las Vegas Sands is a Las Vegas-based developer of multi-use integrated resorts.

BWIC upsized ahead of deadline

Bids are due at noon ET on Thursday for a cash loan BWIC that is sized at about $136 million after being increased from an initial size of $122 million, according to a source.

The BWIC now consists of roughly 35 names, whereas originally it was more like 30 names.

Some of the names included in the portfolio are Charter Communications Operating LLC, Dex Media West LLC, F&W Media Inc., Gateway Casinos & Entertainment, Michaels Stores Inc., Newport Television LLC, Rita Aid Corp. and Texas Competitive Electric Holdings

TI Automotive reworks loan

Switching to the primary, TI Automotive has scheduled a conference call for Thursday to relaunch its term loan that will now carry a reduced size, increased spread and more call protection and collateral, according to a market source.

The term loan is now sized at $150 million, down from $200 million, and is being talked at Libor plus 750 basis points with a 2% Libor floor and an original issue discount of 98, the source said.

Most recent price talk on the loan had been Libor plus 675 bps, and when the deal first launched around mid-June, talk had been Libor plus 550 bps. The Libor floor and discount have been unchanged since the initial launch.

Also, the term loan now has call protection of 102 in year one and 101 in year two, the source continued, whereas initially it was being offered with 101 soft call protection for one year.

Furthermore, collateral was added to the loan as well, the source added.

TI revolver unchanged

TI Automotive's now $200 million, down from $250 million, credit facility also provides for a $50 million four-year asset based revolver, which has been left unchanged in terms of size and pricing. The spread on the tranche is Libor plus 350 bps.

Citigroup is the lead bank on the term loan, and Citi and UBS are leading the revolver.

Commitments towards the term loan will likely be due around Aug. 6.

Proceeds from the credit facility will be used to refinance existing debt.

TI Automotive is a provider of fluid storage and carrying and delivery technology to automotive manufacturers.

Savvis ups spread, sets OID

Savvis came out with changes to its $550 million term loan due in 2016, including flexing pricing higher to Libor plus 500 bps from Libor plus 475 bps, according to a market source.

In addition, the original issue discount was finalized at 97, the wide end of the initial 97 to 98 guidance, the source said.

As before the term loan carries a 1.75% Libor floor and 101 soft call protection for one year.

The company's $625 million senior secured credit facility (B1/B) also includes a $75 million revolver due in 2014.

Savvis readies allocations

With the deal fully subscribed at the revised terms, Savvis is now expecting to allocate its credit facility on Friday, the source continued.

Bank of America, Morgan Stanley, Credit Suisse and SunTrust are the joint lead arrangers and bookrunners on the deal.

Proceeds will be used to help repay existing debt, including outstanding bank borrowings and the repurchase of about $345 million of the company's 3% convertible senior notes due May 2012, and for general corporate purposes.

A tender offer for the convertibles began on July 1 and expires on July 29.

Savvis is a Town & Country, Mo.-based provider of cloud infrastructure and hosted IT services.

Allscripts upsizes pro rata

Allscripts increased its term loan A to $470 million from $320 million and its revolver to $250 million from $150 million, and reduced pricing on both tranches to Libor plus 300 bps from Libor plus 325 bps, according to a market source.

The revolver has a 50 bps unused fee.

As expected since last week, the $250 million term loan B, which was never launched to investors, was officially dropped from the capital structure.

Originally, the deal was outlined as containing one term loan sized at $570 million, but the loan was later divided into an A and a B tranche. It was said from the start that sizes could be moved around based on demand.

Allscripts lead banks

JPMorgan, Barclays Capital and UBS are the lead banks on Allscripts' $720 million credit facility (Ba2/BBB-).

Proceeds will be used to fund the buyback of shares from Misys plc.

Pro forma leverage is 2.1 times last 12 months EBITDA.

Subject to certain conditions being met, the buyback of shares is expected to be completed in September or October.

Allscripts is a Chicago-based provider of software, services, information and connectivity services to physicians and other health care providers.

Ferro launching soon

Ferro is planning a bank meeting in early August to launch its proposed $350 million revolving credit facility, according to a company spokesman.

Proceeds will be used to help fund the refinancing of an existing credit facility.

Other funds for the refinancing will come from $250 million of senior notes that will also be used to repay the company's $172.5 million of 6.5% convertible senior notes due 2013.

The tender offer for the convertibles, which commenced on Tuesday and expires on Aug. 23, is subject to completion of the notes offering and entry into the new credit facility or an amendment to the existing facility to allow for the convertibles repurchase.

Ferro is a Cleveland-based supplier of technology-based performance materials for manufacturers.

Tomkins post-Labor Day event

Tomkins' proposed $3 billion in debt facilities are expected to launch sometime after Labor Day, according to a market source, who added that details on structure are not yet available.

Bank of America, Citigroup, Barclays Capital, RBC Capital Markets and UBS Securities are the lead banks on the deal.

Proceeds, along with $2.2 billion of equity, will be used to fund the buyout of the company by Pinafore Acquisitions Ltd., a company jointly owned by Onex Corp. and Canada Pension Plan Investment Board, for 325 pence per share in cash, or about £2.89 billion.

Closing on the transaction is expected in late September, subject to shareholder approval.

Tomkins is a London-based engineering and manufacturing group, providing a variety of products for the industrial, automotive and building products markets.

Nielsen reveals changes

In more loan happenings, Nielsen modified its extension request to shorten the maturity and lift pricing, and on the back of the changes being made late Tuesday, the tranche A loan moved higher, according to traders.

The tranche A was quoted by one trader at 95¼ bid, 96 offered, up from 95 bid on Tuesday, and by a second trader at 95 3/8 bid, 95 7/8 offered, unchanged on the day.

The second trader remarked that the tranche A was at 95 bid, 95½ offered in the afternoon on Tuesday, but very late in the day, it moved up to the current levels since that was when the extension changes went out to lenders.

Under the changes, the company is now looking to extend the maturity on $1 billion of its term loan debt to 2016 instead of to 2017, and pricing on the extended debt is now being offered at Libor plus 375 bps, as opposed to at Libor plus 325 bps.

Nielsen tranche B pushback

Sources previously told Prospect News that Nielsen's lenders were upset over the initial extension request because there was this existing tranche B that had higher pricing and a shorter maturity than the new tranche that the company was hoping to obtain.

As of March 31, Nielsen had $2.983 billion and €321 million of tranche A term loans due in 2013 and $1.013 billion and €179 million of tranche B term loans due in 2016.

Pricing on the loans due in 2013 is Libor plus 200 bps and pricing on the loans due in 2016, which were extended to that date about a year ago, is Libor plus 375 bps.

Citigroup and JPMorgan are the lead banks on the extension and asked for commitments by the end of the day Wednesday.

Nielsen is a New York-based information and media company.

© 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.