Ineos, Headwaters, Tank, Surgical Care hit secondary; Valeant, Wabash National modify deals

By Sara Rosenberg

New York, March 12 – Ineos Finance plc’s new bank debt freed up for trading on Thursday, with the U.S. term loan B quoted above its original issue discount, and Headwaters Inc., Tank Holding Corp. and Surgical Care Affiliates Inc. emerged in the secondary as well.

Meanwhile, in the primary market, Valeant Pharmaceuticals International Inc. downsized its term loan B, lowered the spread and tightened the original issue discount, and Wabash National Corp. reduced pricing on its term loan.

In addition, Ferrara Candy Co. moved up the commitment deadline on its add-on term loan, Walgreens Infusion Services, Intertain Group Ltd. and FullBeauty Brands released price talk with launch, and Alvogen emerged with new loan plans.

Ineos tops OID

Ineos Finance’s $625 million seven-year senior secured covenant-light term loan B began trading on Thursday with levels seen at 99 7/8 bid, par 3/8 offered, according to a trader.

Pricing on the U.S. term loan B, as well as on an €850 million seven-year senior secured covenant-light term loan B, is Libor/Euribor plus 325 basis points with a 1% floor, and it was sold at an original issue discount of 99½. There is 101 soft call protection for six months.

During syndication, the total amount of term debt was upsized to €1.4 billion equivalent from €750 million equivalent, pricing was reduced Libor/Euribor plus 350 bps, the discount was tightened from 99, and the breakdown of U.S. and euro tranche sizes firmed up from talk at launch of a minimum size of $250 million and a minimum size of €250 million.

Ineos lead banks

Barclays and J.P. Morgan Securities LLC are the lead bookrunners and joint global coordinators on Ineos’ term debt (BB-), and other bookrunners include Bank of America Merrill Lynch, Citigroup Global Markets Inc. and Morgan Stanley Senior Funding Inc.

Proceeds will be used to redeem on April 1 the existing €500 million floating-rate notes due 2019 and all of the existing $1 billion senior secured notes due 2019.

Initially, the company was only going to buy back $300 million of the senior secured notes, but the buyback amount was increased when the total term loan amount was upsized.

Ineos is a London-based manufacturer of petrochemicals, specialty chemicals and oil products.

Headwaters frees up

Headwaters’ $425 million seven-year covenant-light term loan B (B1/BB-) also hit the secondary market, with levels seen at par bid, par ½ offered, a trader said.

Pricing on the term loan is Libor plus 350 bps with a 1% Libor floor, and it was sold at an original issue discount of 99½. The debt has 101 soft call protection for six months.

Recently, the spread on the loan was reduced from the Libor plus 400 bps area and the discount was revised from 99.

Deutsche Bank Securities Inc. is leading the deal that will be used to refinance 7 5/8% senior secured notes.

Closing is expected this month.

Headwaters is a South Jordan, Utah-based manufacturer of light building products and heavy construction materials.

Tank starts trading

Another deal to make its way into the secondary was Tank Holding, with its $460 million seven-year covenant-light term loan B quoted at 99¾ bid, par ¼ offered, according to a market source.

The term loan is priced at Libor plus 425 bps with a step-down to Libor plus 400 bps when total net leverage is below 5.25 times and a 1% Libor floor. The debt was issued at 99½ and has 101 soft call protection for six months.

The company’s $510 million senior secured credit facility (B) also includes a $50 million six-year revolver that is priced at Libor plus 425 bps with no Libor floor and was sold at a discount of 99½. This tranche has step-downs to Libor plus 400 bps when total net leverage is below 5.25 times and Libor plus 375 bps when total net leverage is below 4.5 times.

During syndication, the term loan was upsized from $440 million and the step-down was added, pricing on the term B and the revolver firmed at the high end of the Libor plus 400 bps to 425 bps talk, the discount on the tranches tightened from 99 and the MFN sunset provision was eliminated.

Tank recapitalizing

Proceeds from Tank Holding’s credit facility will be used to refinance existing debt, including the paydown of $45 million of senior notes, and to fund a distribution to shareholders.

The notes paydown was increased from $25 million due to the recent term loan upsizing.

GE Capital Markets and RBC Capital Markets are leading the deal, which is expected to close on Monday, the source added.

Pro forma for the transaction, senior net leverage will be 4.6 times and total net leverage will be 6.2 times.

Tank Holding is a St. Bonifacius, Minn., and Lincoln, Neb.-based manufacturer of proprietary rotational molded polyethylene and steel storage tanks and containers used in above-ground, below-ground and portable applications.

Surgical Care breaks

Surgical Care Affiliates’ credit facility freed up as well, with the $450 million term loan quoted at 99 7/8 bid, par 3/8 offered, and then it moved up to par bid, par ½ offered, a trader remarked.

Pricing on the term loan is Libor plus 325 bps with a 1% Libor floor, and it was issued at a discount of 99¾. There is 101 soft call protection for six months.

During syndication, the term loan was upsized from $350 million as the company’s senior unsecured notes were downsized to $250 million from $350 million, pricing was reduced from Libor plus 375 bps and the discount firmed at the tight end of revised talk of 99½ to 99¾ and tighter than initial talk of 99.

The company’s $700 million senior secured credit facility (B1/B+) also includes a $250 million revolver.

Surgical Care refinancing

Proceeds from Surgical Care’s credit facility and bonds will be used to refinance an existing credit facility that includes a $132 million revolver and $596 million of term loans and for general corporate purposes, including acquisitions and other development activities.

J.P. Morgan Securities LLC, Goldman Sachs Bank USA, Citigroup Global Markets Inc., Barclays, Morgan Stanley Senior Funding Inc., Bank of America Merrill Lynch and SunTrust Robinson Humphrey Inc. are leading the deal.

Closing is expected by the end of this quarter.

Surgical Care is a Deerfield, Ill.-based operator of surgical facilities.

Valeant reworks deal

Moving to the primary market, Valeant Pharmaceuticals cut its seven-year senior secured first-lien term loan B to $4.15 billion from $4.55 billion, trimmed pricing to Libor plus 325 bps from Libor plus 350 bps and moved the original issue discount to 99½ from 99, according to market sources.

The term loan B has a step-down to Libor plus 300 bps at 1.75 times net senior secured leverage and a ticking fee of the spread plus the floor starting 30 days from allocations, sources said.

As before, the B loan includes a 0.75% Libor floor and 101 soft call protection for six months.

Recommitments were due at 5 p.m. ET on Thursday, sources added. The initial deadline had been set for noon ET on Friday.

Along with the term loan B, the company is getting a $1 billion incremental five-year term loan A.

Deutsche Bank Securities Inc., HSBC Securities (USA) Inc., the Bank of Tokyo-Mitsubishi UFJ Ltd., DNB Markets Inc., SunTrust Robinson Humphrey Inc., Barclays, Morgan Stanley Senior Funding Inc., RBC Capital Markets and Citigroup Global Markets Inc. are leading the $5.55 billion of incremental term loan debt (Ba1/BB).

Valeant buying Salix

Proceeds from Valeant’s term loans will be used with $10 billion equivalent of senior unsecured notes, upsized from $9.6 billion equivalent with the term loan B downsizing, and cash on hand to fund the acquisition of Salix Pharmaceuticals Ltd. for $158.00 per share in cash, or a total enterprise value of about $14.5 billion, repay Salix’s existing credit facility, redeem Salix’s 6% senior notes due 2021 and pay any cash consideration necessary upon the conversion of Salix’s 1.5% convertible senior notes due 2019 and 2.75% convertible senior notes due 2015.

Closing is expected in the second quarter, subject to customary conditions and regulatory approval.

Net debt to adjusted pro forma EBITDA will be around 5.6 times.

Valeant is a Laval, Quebec-based specialty pharmaceutical company. Salix is a Raleigh, N.C.-based developer and marketer of prescription pharmaceutical products and medical devices for the prevention and treatment of gastrointestinal diseases.

Wabash trims spread

Wabash National cut pricing on its $192.8 million senior secured term loan (Ba3/BB) due 2022 to Libor plus 325 bps from Libor plus 350 bps, while keeping the 1% Libor floor, original issue discount of 99½ and 101 soft call protection for one year intact, a market source said.

Wells Fargo Securities LLC and Morgan Stanley Senior Funding Inc. are leading the deal that will be used to repay an existing term loan due May 8, 2019.

Wabash is a Lafayette, Ind.-based diversified industrial manufacturer and a producer of semi-trailers and liquid transportation systems.

Ferrara Candy tweaks deadline

Ferrara Candy accelerated the commitment deadline on its fungible $40 million add-on first-lien covenant-light term loan (B) due June 2018 to the end of the day on Thursday from Friday, a source remarked.

Allocations are expected on Friday morning, the source added.

Pricing on the add-on term loan is Libor plus 625 bps with a 1.25% Libor floor, and it is being sold at an original issue discount of 98.

Morgan Stanley Senior Funding Inc. is leading the deal that will be used to pay down ABL credit facility borrowings.

Ferrara Candy is a confectionery and candy manufacturer.

Walgreens reveals guidance

In more primary news, Walgreens Infusion Services held its bank meeting on Thursday to launch its $415 million seven-year term loan, and with the event, talk on the debt surfaced at Libor plus 500 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, a market source remarked.

The company’s $495 million credit facility (B) also includes an $80 million revolver.

Commitments are due on March 24, the source added.

Bank of America Merrill Lynch, Barclays, Deutsche Bank Securities Inc. and Goldman Sachs Bank USA are leading the deal that will be used with $150 million of second-lien debt placed with Goldman Sachs Mezzanine and equity to fund the buyout of the company by Madison Dearborn Partners from Walgreen Co.

Closing is expected in the second quarter, subject to satisfaction of regulatory requirements and other conditions.

Walgreens Infusion Services is a provider of home and alternate treatment site infusion services.

Intertain talk emerges

Intertain Group came out with talk of Libor plus 500 bps to 525 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for six months on its $335 million seven-year first-lien covenant-light term loan that launched with a morning bank meeting, according to a market source.

The company’s $352.5 million credit facility (B2/BB) also includes a $17.5 million revolver.

Commitments are due on March 26, the source said.

Macquarie Capital (USA) Inc. is leading the deal that will be used to help fund the acquisition of Gamesys’ business-to-consumer assets for £425.8 million.

Pro forma leverage is 3 times, and net leverage is 2.3 times.

Intertain is a Toronto-based owner of a variety of bingo-led and other market-leading business-to-consumer assets.

FullBeauty holds call

FullBeauty Brands hosted a call at 2 p.m. ET, launching a fungible $160 million add-on first-lien term loan talked at Libor plus 375 bps to 400 bps with a 1% Libor floor, an original issue discount of 99½ and 101 soft call protection for six months, according to market sources.

The company is also repricing its existing first-lien term loan with talk being Libor plus 375 bps to 400 bps with a 1% Libor floor, compared to current pricing of Libor plus 350 bps with a 1% Libor floor, and the debt will get the 101 soft call protection for six months as well.

Goldman Sachs Bank USA, Jefferies Finance LLC and BMO Capital Markets are leading the deal for which commitments are due on March 19.

Proceeds from the add-on will be used to help fund a dividend, sources added.

FullBeauty Brands, previously known as OneStopPlus Group, is a New York-based catalog retailer and online marketplace for plus-size consumers.

Alvogen coming soon

Alvogen surfaced with plans to hold a bank meeting on Tuesday morning to launch a $675 million seven-year senior secured term loan, according to a market source.

Jefferies Finance LLC, Goldman Sachs Bank USA and SunTrust Robinson Humphrey Inc. are leading the deal that will be used to refinance existing debt and for general corporate purposes.

Alvogen is a generic pharmaceutical company.

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