Wall Street Systems frees to trade following revisions; Berry Plastics loans move around

By Sara Rosenberg

New York, Aug. 25 – Wall Street Systems Holdings Inc.’s extended U.S. term loan made its way into the secondary market on Thursday morning after the deal went through a complete restructuring during syndication.

Also, Berry Plastics Group Inc. saw mixed movement in its term loans after the company announced plans to take on additional debt for the purchase of AEP Industries Inc.; however, sources attributed the change in levels more to regular trading activity in the name than to the acquisition news.

Wall Street breaks

Wall Street Systems’ $330.3 million amended and extended term loan due 2023 began trading on Thursday, with levels quoted at 99¾ bid, 100¼ offered, according to a market source.

Along with the amended U.S. term loan, which is being extended from 2021, the company is getting a €150 million seven-year covenant-light term loan.

Pricing on the extended U.S. term loan and on the euro term loan is Libor/Euribor plus 375 basis points with a 1% floor. New money received an original issue discount of 99.5, and existing money received a 50-bps consent fee, the source said. All of the debt has 101 soft call protection for six months.

Initially, the company came to market with a $165 million add-on U.S. term loan talked at Libor plus 350 bps with a 1% Libor floor, an original issue discount of 99 to 99.5 and a 101 soft call protection for six months, but the add-on loan was replaced with the new euro term loan as a result of demand from European investors, the source explained.

Wall Street firms revolver

In addition to finalizing its term loan plans, Wall Street Systems set its five-year revolver size at $15 million compared to a size at launch of $30 million on a best efforts. The company still has the flexibility to grow the revolver to $30 million at a later date, the source added.

UBS Investment Bank is leading the deal (B2/B).

The company will use the new debt to fund an acquisition and pay a dividend.

The few million in extra proceeds being raised from the euro term loan versus the originally planned add-on U.S. term loan is being used to pay down the existing U.S. term loan by about $5 million from $335 million.

Wall Street Systems is a provider of treasury management, central banking and FX trade processing solutions with U.S. headquarters in New York.

Berry Plastics mixed

Also in trading, Berry Plastics’ term loan H rose to 100½ bid, 100¾ offered from 100 3/8 bid, 100 5/8 offered and its term loan G fell to par bid, 100¼ offered from 100 1/8 bid, 100 3/8 offered, traders said.

The company disclosed in the morning that it is buying AEP Industries, but traders explained that the acquisition announcement seemed to have very little to do with the movement in term loan levels. They pointed to trading activity in the name as the force behind the level changes.

AEP is being purchased for either $110 in cash or 2.5011 shares of Berry common stock per AEP share, subject to an overall 50/50 proration to ensure that 50% of the total outstanding AEP shares are exchanged for the cash consideration. The transaction is valued at $765 million, including AEP’s net debt.

The cash portion of the transaction will be funded with an incremental term loan and cash on hand.

Closing is expected in the December quarter, subject to AEP shareholder approval, regulatory approvals and other customary conditions.

Berry is an Evansville, Ind.-based provider of value-added plastic consumer packaging and engineered materials. AEP is a Montvale, N.J.-based manufacturer of flexible plastic packaging films.

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