Gates Global, American Tire Distributors break; Phillips-Medisize, Mediacom update deals

By Sara Rosenberg

New York, June 12 – Gates Global LLC’s credit facility freed up for trading during Thursday’s market hours, with the U.S. term loan quoted above its original issue discount price, and American Tire Distributors Inc. hit the secondary too.

Switching to the primary, Phillips-Medisize Corp. trimmed spreads on its first- and second-lien term loans, while also tightening the offer price and extending the call protection on the first-lien tranche, and Mediacom set pricing on its term loan J at the low end of talk and modified the original issue discount.

Furthermore, Rovi Solutions Corp., Husky International Ltd., Wencor Group LLC (Jazz Acquisition Inc.) and Birch Communications Inc. came out with talk in connection with their launches.

Gates starts trading

Gates Global’s credit facility broke for trading on Thursday, and the $2.49 billion seven-year first-lien covenant-light term loan (B2/B+) was seen at 99¾ bid, par offered on the open and then it moved up to par bid, par ¼ offered, according to one trader. Meanwhile, a second trader was quoting it at 99¾ bid, par offered in the late afternoon.

Pricing on the U.S. term loan, as well as on a €200 million seven-year first-lien covenant-light term loan (B2/B+), is Libor/Euribor plus 325 basis points with a 1% floor and the debt was sold an original issue discount of 99. The loans have 101 soft call protection for one year and a ticking fee of half the spread for days 31 to 60 and the full spread thereafter.

Recently, pricing on the term loans was decreased from talk of Libor/Euribor plus 375 bps to 400 bps and the MFN sunset was extended to 18 months from 12 months.

Gates getting revolvers

Along with the term loans, Gates Global’s credit facility provides for a $125 million five-year revolver (B2/B+) and a $325 million five-year ABL revolver.

Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc., Goldman Sachs Bank USA, Morgan Stanley Senior Funding Inc., Deutsche Bank Securities Inc., UBS AG and Macquarie Capital (USA) Inc. are leading the deal.

Proceeds will be used with senior notes to fund Blackstone’s buyout of the company from Onex Corp. and Canada Pension Plan Investment Board.

Gates is a Denver-based manufacturer of power transmission belts and fluid power products.

American Tire tops par

American Tire Distributors’ $420 million incremental term loan (B2/CCC+) due June 2018 freed up as well, with levels quoted at par ¼ bid, par ¾ offered, a trader remarked.

Pricing on the incremental loan, which is split between a $340 million funded tranche and an $80 million delayed-draw tranche, is Libor plus 475 bps with a 1% Libor floor. The debt was issued at par after seeing the offer price tighten the other day from 99¾.

Bank of America Merrill Lynch is leading the deal that will be used to refinance 9¾% notes.

American Tire is a Huntersville, N.C.-based replacement tire distributor.

Phillips-Medisize flexes

Over in the primary, Phillips-Medisize reduced pricing on its $365 million first-lien covenant-light term loan (B2/B) to Libor plus 375 bps from talk of Libor plus 425 bps to 450 bps, moved the original issue discount to 99½ from 99 and extended the 101 soft call protection to one year from six months, according to a market source.

In addition, the spread on the $170 million second-lien covenant-light term loan (Caa2/CCC+) was cut to Libor plus 725 bps from talk of Libor plus 750 bps to 775 bps, the source said.

As before, both term loans still have a 1% Libor floor, and the second-lien term loan has a discount of 99 and call protection of 102 in year one and 101 in year two.

The company’s $605 million credit facility also includes a $70 million revolver (B2/B).

Phillips-Medisize being bought

Proceeds from Phillips-Medisize’s credit facility 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.

Recommitments were due on Thursday and allocations are targeted for Friday, the source added.

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.

Mediacom tweaks deal

Mediacom firmed the spread on its $250 million seven-year term loan at Libor plus 300 bps, the low end of the Libor plus 300 bps to 325 bps talk, and tightened the original issue discount to 99½ from 99, a market source remarked.

The term loan J still has a 0.75% Libor floor and 101 soft call protection for one year.

The company’s $500 million in new debt (Ba3/BB) also includes a $250 million three-year term loan talked at Libor plus 275 bps to 300 bps with a discount of 99½ and 101 soft call protection for six months.

J.P. Morgan Securities LLC is leading the deal that will be used by the Middletown, N.Y.-based cable operator to refinance existing debt.

Rovi discloses guidance

Rovi Solutions held its bank meeting on Thursday, and with the event, price talk on its $1 billion senior secured credit facility (Ba3/BB-) surfaced, according to a market source.

Both the $200 million five-year revolver and $100 million five-year term loan A are talked at Libor plus 225 bps, subject to a grid, with an offer price of 99 5/8, and the $700 million seven-year covenant-light term loan B is talked at Libor plus 300 bps to 325 bps with a 0.75% to 1% Libor floor, an original issue discount of 99½ and 101 soft call protection for six months, the source said.

Commitments are due on June 26 and closing is expected during the week of June 30.

Morgan Stanley Senior Funding Inc. and Bank of America Merrill Lynch are leading the deal that will be used to refinance existing debt and for general corporate purposes.

Rovi is a Santa Clara, Calif.-based technology company.

Husky launches

Husky launched with a morning bank meeting its $1,265,000,000 covenant-light seven-year first-lien term loan (B1/B) with talk of Libor plus 325 bps to 350 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, according to a source.

Also, the $300 million covenant-light eight-year second-lien term loan (Caa1/CCC+) was launched at Libor plus 625 bps to 650 bps with a 1% Libor floor, a discount of 99, and hard call protection of 102 in year one and 101 in year two, the source said.

Commitments for the company’s $1,675,000,000 credit facility, which also includes a $110 million five-year revolver (B1/B), are due on June 23 and proceeds will be used to refinance existing bank and mezzanine debt.

Goldman Sachs Bank USA, Morgan Stanley Senior Funding Inc. and TD Securities (USA) LLC are the joint lead arrangers on the deal and joint bookrunners with Barclays and RBC Capital Markets.

Husky is a Bolton, Ont.-based supplier of injection molding equipment and services to the plastics industry.

Wencor sets talk

Wencor released talk of Libor plus 375 bps on its $320 million seven-year first-lien covenant-light term loan and Libor plus 700 bps on its $155 million eight-year second-lien covenant-light term loan with its bank meeting, a market source said, adding that both loans have a 1% Libor floor and an original issue discount of 99.

As previously reported, the first-lien term loan has 101 soft call protection for six months, and the second-lien term loan has call protection of 102 in year one and 101 in year two.

The company’s $540 million credit facility also includes a $65 million revolver.

Commitments are due on June 23, the source added.

Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and Goldman Sachs Bank USA are leading the deal that will help fund the buyout of the company by Warburg Pincus from Odyssey Investment Partners LLC, which is expected to close this quarter, subject to customary regulatory approvals.

Wencor is a Springville, Utah-based designer, repair provider and distributor of aftermarket aerospace components.

Birch holds meeting

Birch Communications had its bank meeting, launching its $450 million six-year term loan with talk of Libor plus 550 bps to 575 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, according to a market source.

The company’s $500 million senior secured credit facility (B3) also includes a $50 million five-year revolver.

Commitments are due on June 26, the source said.

Jefferies Finance LLC and PNC Capital Markets LLC are leading the deal that will be used to help fund the acquisition of Cbeyond Inc. for about $10 per share in cash, or about $323 million.

Leverage is around 2.5 times.

Birch is an Atlanta-based IP-based telecommunications and managed services provider. Cbeyond is an Atlanta-based technology ally to small- and mid-sized businesses.

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