J.C. Penney, Hillman Group, Phillips-Medisize free up; ConvergeOne, Mediacom modify deals

By Sara Rosenberg

New York, June 13 – J.C. Penney Co. Inc. tightened pricing and the original issue discount on its term loan and then freed up for trading on Friday, Hillman Group Inc. and Phillips-Medisize Corp. saw their credit facilities emerge in the secondary, and Toys “R” Us Inc.’s loans were better on the back of earnings.

In more happenings, ConvergeOne Holdings Corp. lifted the spread on its first-lien term loan and adjusted the call protection on the tranche as well as on its second-lien loan, and Mediacom upsized its term loan J while revising the offer price, lowered pricing on its term loan I and added a term loan G to its refinancing plans.

Also, V.Group accelerated the commitment deadline on its credit facility, Jacobs Douwe Egberts price talk surfaced, and Premier Trailer Leasing Inc., Tribune Publishing Co., the Winebow Group LLC, TriNet HR Corp. and Altegrity Inc.emerged with new deal plans.

J.C. Penney revised, breaks

J.C. Penney trimmed pricing on its $500 million term loan (B2/B) to Libor plus 400 basis points from talk of Libor plus 450 bps to 475 bps and moved the original issue discount to 99¼ from 99, according to a market source. The debt still has a 1% Libor floor and 101 soft call protection for six months.

The company’s $2.35 billion credit facility also includes a $1.85 billion asset-based revolver (B1/B).

Recommitments were due at noon ET on Friday, and with final terms in place, the deal was able to hit the secondary market in the afternoon, with term loan levels quoted at par bid, par ¾ offered, a trader remarked.

Bank of America Merrill Lynch, Wells Fargo Securities LLC, J.P. Morgan Securities LLC, Barclays and Goldman Sachs Bank USA are leading the deal, with Bank of America the left lead on the term loan and Wells Fargo the left lead on the revolver.

Proceeds will be used by the Plano, Texas-based operator of department stores to refinance an existing asset-based revolver and for general corporate purposes.

Hillman starts trading

Hillman Group’s credit facility broke as well, with the $550 million seven-year covenant-light term loan B quoted at par ¼ bid, par ¾ offered, according to a trader.

Pricing on the term loan is Libor plus 350 basis points with a step-down to Libor plus 325 bps at net total opco leverage of 5.5 times. There is a 1% Libor floor and 101 soft call protection for six months, and the debt was sold at an original issue discount of 99¾.

During syndication, the term loan B was downsized from $610 million, pricing was reduced from Libor plus 375 bps, the step-down was added, the discount was tightened from 99 and the call protection was shortened from one year.

The company’s $620 million senior secured credit facility (B1/B) also includes a $70 million five-year revolver.

Hillman lead banks

Barclays, Morgan Stanley Senior Funding Inc. and GE Capital Markets are leading Hillman’s credit facility that will be used to help fund the $1,475,000,000 buyout of the company by CCMP Capital Advisors LLC from Oak Hill Capital Partners.

Other funds for the transaction will come from $330 million of senior notes, upsized from $270 million when the term loan was downsized, and about $545 million of equity.

Senior secured leverage is 4.1 times and total opco leverage is 6.5 times.

Closing on the credit facility is expected on June 30.

Following completion of the buyout, Oak Hill Capital and its affiliates will retain a significant minority interest in the company.

Hillman is a Cincinnati-based distributor of fasteners, key duplication systems, engraved tags and related hardware items.

Phillips-Medisize tops OIDs

Phillips-Medisize’s credit facility began trading too, with the $365 million first-lien covenant-light term loan (B2/B) seen at par bid, 101 offered on the open and then it moved to par bid, par ¾ offered, and the $170 million second-lien covenant-light term loan (Caa2/CCC+) seen at par bid on the open and then it rose to par ½ bid, a market source said.

Pricing on the first-lien term loan is Libor plus 375 bps with a 1% Libor floor and it was sold at an original issue discount of 99½. There is 101 soft call protection for one year.

The second-lien term loan is priced at Libor plus 725 bps with a 1% Libor floor and was issued at 99. This debt has call protection of 102 in year one and 101 in year two.

The other day, pricing on the first-lien term loan was reduced from talk of Libor plus 425 bps to 450 bps, the discount was changed from 99 and the call protection as extended from six months, and pricing on the second-lien loan was trimmed from talk of Libor plus 750 bps to 775 bps.

Phillips-Medisize buyout

Proceeds from Phillips-Medisize’s $605 million credit facility, which also includes a $70 million revolver (B2/B), will be used to help fund its buyout by Golden Gate Capital from Kohlberg & Co. LLC.

Goldman Sachs Bank USA, UBS Securities LLC and Jefferies Finance LLC are leading the deal.

Closing on the buyout is expected in the coming months, subject to customary regulatory approvals.

Phillips-Medisize is a Hudson, Wis.-based provider of design and manufacturing services to the pharmaceutical, medical device, diagnostic and specialty commercial markets.

Toys “R” Us rises

Also in trading, Toys “R” Us’ term loans were stronger on the back of the release of earnings during the previous session, according to a trader.

The term loan B-1 was quoted at 88¾ bid, 89¾ offered, up from 88½ bid, 89½ offered, the term loans B-2 and B-3 were quoted at 81½ bid, 82½ offered, up from 80 bid, 81 offered, and the propco term loan was quoted at 97¼ bid, 97¾ offered, up from 96½ bid, 97½ offered, the trader said.

For the quarter ended May 3, the company reported a net loss of $196 million, compared to a net loss of $111 million in the prior year primarily due to a decrease in income tax benefit and an increase in SG&A.

Consolidated net sales for the quarter were $2.48 billion, an increase of 2.9% from $2.41 billion in the previous year.

And, adjusted EBITDA was $33 million, down slightly from $39 million last year.

Toys “R” Us is a Wayne, N.J.-based toy and juvenile products retailer.

ConvergeOne changes surface

Back in the primary, ConvergeOne widened pricing on its $190 million six-year first-lien term loan (B2/B) to Libor plus 500 bps from Libor plus 475 bps, extended the 101 soft call protection to one year from six months and eliminated the MFN sunset, a source said. The 1% Libor floor and original issue discount of 99 were unchanged.

Regarding the $80 million seven-year second-lien term loan (Caa2/CCC+), the call protection was shortened to 102 in year one and 101 in year two from 103 in year one, 102 in year two and 101 in year three, the source remarked, adding that pricing was left at Libor plus 800 bps with a 1% Libor floor and a discount of 99.

The company’s $295 million credit facility also includes a $25 million revolver (B2/B).

Recommitments were due at 2 p.m. ET on Friday and allocations are expected on Monday.

Credit Suisse Securities (USA) LLC and BMO Capital Markets are leading the deal that will be used to help fund the buyout of the company by Clearlake Capital Group LP.

ConvergeOne is an Eagan, Minn.-based provider of data, communications, collaboration and customer interaction and managed services.

Mediacom reworks deal

Mediacom Broadband lifted its seven-year term loan J to $300 million from $250 million and changed the original issue discount to 99¾ from revised talk of 99½ and initial talk of 99, according to a market source.

Pricing on the term loan J is still Libor plus 300 bps with a step-down to Libor plus 275 bps at 3 times secured leverage and a 0.75% Libor floor, and there is still 101 soft call protection for one year. The other day, pricing on this loan firmed at the tight end of the Libor plus 300 bps to 325 bps talk, the step-down was added and the original issue discount was revised from 99.

Meanwhile, the $250 million three-year term loan I saw its spread move to Libor plus 250 bps from talk of Libor plus 275 bps to 300 bps, while the discount of 99½ and 101 soft call protection for six months were unchanged. This tranche has no Libor floor.

Mediacom adds tranche

Also, Mediacom added a $350 million seven-year term loan G at the Mediacom LLC level, and this debt is talked at Libor plus 300 bps with a leverage-based step-down, a 0.75% Libor floor, a discount of 99½ and 101 soft call protection for one year, the source remarked.

J.P. Morgan Securities LLC, Bank of America Merrill Lynch, RBC Capital Markets, Natixis, Wells Fargo Securities LLC, SunTrust Robinson Humphrey Inc., Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc. are leading the deal that will be used to refinance existing debt.

Mediacom is a Middletown, N.Y.-based cable operator.

V.Group moves deadline

V.Group accelerated the commitment deadline on its $420 million credit facility to noon ET on Tuesday from Wednesday, a market source said.

The facility consists of a $35 million five-year revolver (B1/B), a $260 million seven-year covenant-light first-lien term loan (B1/B) talked at Libor plus 425 bps to 450 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, and a $125 million 7½-year covenant-light second-lien term loan (Caa1/CCC+) talked at Libor plus 775 bps to 800 bps with a 1% Libor floor, a discount of 98½ to 99 and call protection of 102 in year one and 101 in year two.

RBC Capital Markets and Goldman Sachs Bank USA are leading the deal, with RBC left lead on the first-lien loan and Goldman left lead on the second-lien loan.

V.Group, a supplier of specialist outsourcing services to asset owners and operators in the shipping, offshore, leisure and defense sectors, will used the credit facility to refinance existing debt and pay a dividend.

Jacobs Douwe sets talk

Also on the new deal front, Jacobs Douwe Egberts released talk of Libor/Euribor plus 325 bps with a 0.75% floor on its €3 billion seven-year term loan B and €1.2 billion U.S. equivalent seven-year term loan B, according to sources.

The term loans have 101 soft call protection for six months, and are whispered at an original issue discount of 99 to 99½, sources said.

A bank meeting was held in New York on Friday for the deal and one already took place for European investors this past Wednesday.

The company’s €7.6 billion credit facility (BB) also includes a €500 million revolver and a €2.9 billion five-year term loan A, both talked at Euribor plus 300 bps.

J.P. Morgan Securities LLC, Bank of America Merrill Lynch and Morgan Stanley Senior Funding Inc. are leading the deal that will be used to help fund the merger of Mondelez International Inc. and D.E Master Blenders 1753 B.V. to create Jacobs Douwe, a Netherlands-based coffee company.

Premier Trailer on deck

Premier Trailer Leasing is set to hold a bank meeting at 2 p.m. ET in New York on Monday to launch a $135 million six-year second-lien term loan (CCC) that is talked at Libor plus 800 bps with a 1% Libor floor, an original issue discount of 98 and call protection of 102 in year one and 101 in year two, a market source said.

Commitments are due on June 30, the source added.

Credit Suisse Securities (USA) LLC is leading the deal that will be used for a dividend recapitalization.

Premier Trailer is a Grapevine, Texas-based provider of trailer rental and leasing services.

Tribune Publishing plans deal

Tribune Publishing will hold a bank meeting on Tuesday to launch a $490 million credit facility, according to an informed source.

The facility consists of a $140 million five-year asset-based revolver and a $350 million seven-year senior secured term loan.

J.P. Morgan Securities LLC is leading the deal that is being done in connection with the separation of Tribune Publishing from Tribune Co.

Proceeds will be used for working capital and to fund a dividend to Tribune of up to $275 million.

Closing is expected in the third quarter.

Tribune Publishing is a Chicago-based newspaper publishing and local news and information gathering company.

Winebow coming soon

Winebow Group scheduled a bank meeting for Tuesday to launch $360 million in new term loans, according to sources.

The debt consists of a $130 million seven-year first-lien covenant-light term loan and a $130 million 7½-year second-lien covenant-light term loan, sources said.

Bank of America Merrill Lynch is leading the deal that will be used to refinance existing debt and fund a dividend.

Winebow Group, a fine wine and craft spirits company, is being created through the merger of Winebow Inc. and the Vintner Group Inc.

TriNet joins calendar

TriNet set a bank meeting for Tuesday to launch a $650 million credit facility, according to a market source.

The facility consists of a $75 million five-year revolver talked at Libor plus 275 bps, a $400 million five-year term loan A talked at Libor plus 275 bps, and a $175 million three-year term loan B talked at Libor plus 300 bps with no Libor floor, an original issue discount of 99½ and 101 soft call protection for six months, the source said.

J.P. Morgan Securities LLC is leading the deal that will be used to refinance existing debt.

TriNet is a San Leandro, Calif.-based cloud-based provider of on-demand HR services.

Altegrity sets meeting

Altegrity scheduled a bank meeting for Monday to launch new term loan debt, according to a market source.

The company is planning on getting $1.1 billion in new first-lien term loan and bond borrowings, with the breakdown of sizes not yet available, the source said.

Goldman Sachs Bank USA is leading the deal that will be used to refinance existing debt.

Altegrity is a Falls Church, Va.-based risk and information services company.

Brickman readies allocations

In other news, Brickman Group Ltd. LLC is expected to allocate its fungible $725 million incremental first-lien term loan due December 2020 on Tuesday, assuming ratings are confirmed, a market source said.

The incremental loan is priced at Libor plus 300 bps with a 1% Libor floor, in line with the existing $735 million first-lien covenant-light term loan, and is being offered at an original issue discount of 99. All of the first-lien term debt will get 101 soft call protection for six months.

The company is also getting a $100 million revolver.

Jefferies Finance LLC, Macquarie Capital (USA) Inc., Mizuho Bank, Sumitomo Mitsui Banking Corp., Nomura and KKR Capital Markets are leading the $825 million deal. Morgan Stanley Senior Funding Inc. is the administrative agent.

Brickman buying ValleyCrest

Proceeds from Brickman’s new bank debt will be used to help fund the acquisition of ValleyCrest Cos. LLC, which is expected to close by mid-year.

Brickman is owned by KKR, and ValleyCrest is currently owned by MSD Capital LP. Following the close, KKR will have majority ownership of the combined company, and MSD Capital will retain a significant minority ownership interest.

Brickman is a Rockville, Md.-based provider of landscape maintenance and snow removal services. ValleyCrest is a Calabasas, Calif.-based landscape services company.

Gray Television closes

Gray Television Inc. completed its $575 million senior secured credit facility (Ba3/BB) that includes a $50 million revolver and a $525 million term loan, according to an 8-K filed with the Securities and Exchange Commission.

The term loan is priced at Libor plus 300 bps with a 0.75% Libor floor and was sold at an original issue discount of 99¾. There is 101 soft call protection for six months.

During syndication, the term loan was upsized from $500 million, the floor was cut from 1% and the discount was revised from 99½.

Wells Fargo Securities LLC, Bank of America Merrill Lynch and RBC Capital Markets are leading the deal that will be used to refinance existing debt and to complete pending acquisitions.

Gray Television is an Atlanta-based owner and operator of television stations and digital assets.

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