TierPoint frees up; Western Digital revises pricing; TruGreen Holdings sets price talk

By Sara Rosenberg

New York, March 29 – TierPoint allocated its fungible add-on first- and second-lien term loans on Tuesday, and the first-lien debt was bid right around its original issue discount upon entering the secondary market.

Switching to the primary market, Western Digital Corp. increased pricing on its term loan B debt and widened the original issue discount, and TruGreen Holdings Inc. released price talk on its B loan with launch.

Furthermore, Alvogen emerged with an add-on term loan, and Premiere Global Services Inc., ERT (eResearchTechnology Inc.) and Pinnacle Entertainment (OpCo) all joined this week’s primary calendar.

TierPoint breaks

TierPoint’s $100 million add-on first-lien term loan (B2) hit the secondary market on Tuesday, with levels quoted at 98 bid, 99 offered, according to a trader.

Pricing on the add-on first-lien term loan is Libor plus 450 basis points with a 1% Libor floor, and it was sold at an original issue discount of 98.

The company is also getting a $40 million add-on second-lien term loan (Caa2) priced at Libor plus 875 bps with a 1% Libor floor and issued at a discount of 96.5.

The add-on term loans are fungible with the loans TierPoint syndicated in December 2015.

Due to the original issue discount on the add-on second-lien term loan, the MFN on an existing $90 million second-lien term loan done in 2014 was activated, increasing pricing on that tranche to Libor plus 887.5 bps with a 1% Libor floor.

RBC Capital Markets is leading the $140 million of new debt that will be used to help fund the acquisition of Cosentry, an Omaha, Neb.-based provider of cloud, colocation and managed services.

TierPoint is a St. Louis-based provider of cloud, colocation and managed services designed to help organizations improve business performance and manage risk.

BWIC surfaces

Also in trading, a roughly $203.7 million Bid Wanted In Competition emerged, with bid due at 10 a.m. ET on Wednesday, a trader said.

Some of the names in the portfolio are Alliance HealthCare Services Inc., Communications Sales & Leasing Inc., Dealer Tire LLC, Onsite Rental Group Operations Pty Ltd., Tube City IMS Corp., World Kitchen LLC, WP CPP Holdings LLC and Zep Inc.

The portfolio includes about 65 issuers in the portfolio, the trader added.

Western Digital reworked

Moving to the primary market, Western Digital raised pricing on its $4.2 billion seven-year covenant-light term loan B and $550 million equivalent euro-denominated seven-year covenant-light term loan B to Libor/Euribor plus 550 bps from talk of Libor/Euribor plus 450 bps to 475 bps and changed the original issue discount to 97 from 98.5, according to a market source.

As before, the B loans have a 0.75% floor and 101 soft call protection for one year.

Commitments are due at 11 a.m. ET on Wednesday, the source said.

The company’s $9.5 billion credit facility (Ba1/BBB-/BBB-) also includes a $1 billion five-year revolver and a $3.75 billion five-year term loan A.

J.P. Morgan Securities LLC, Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC and RBC Capital Markets LLC are leading the deal.

Western Digital buying SanDisk

Proceeds from Western Digital’s credit facility, $1.5 billion of senior secured notes due 2023, $4.1 billion of senior unsecured notes due 2024 and stock will be used to fund the acquisition of SanDisk Corp. and refinance existing debt at both companies.

SanDisk is being bought for $78.80 per share for a total equity value of about $17 billion. Assuming no closing cash shortfall, Western Digital will pay $67.50 in cash and 0.2387 of a share of Western Digital common stock per share of SanDisk common stock.

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

Western Digital is an Irvine, Calif.-based developer and manufacturer of storage solutions that enable people to create, manage, experience and preserve digital content. SanDisk is a Milpitas, Calif.-based provider of flash storage solutions.

TruGreen discloses talk

TruGreen held its bank meeting on Tuesday, launching its $560 million term loan B with talk of Libor plus 575 bps with a 1% Libor floor, an original issue discount of 98 to 98.5 and 101 soft call protection for six months, a market source said.

The company’s $706 million credit facility (B1/B) also includes a $146 million revolver.

Commitments are due on April 8, the source added.

J.P. Morgan Securities LLC, Credit Suisse Securities (USA) LLC, ING Capital Markets and Natixis are leading the deal that will be used to help fund the merger of TruGreen, a portfolio company of Clayton, Dubilier & Rice, with Scotts LawnService, which is currently owned by Scotts Miracle-Gro Co.

The company is also getting a $200 million second-lien term loan that was privately placed.

At the closing of the transaction, ScottsMiracle-Gro will own an equity stake of about 30% in the combined business, and Clayton, Dubilier & Rice will own the controlling interest.

Closing is subject to customary conditions and the receipt of debt financing.

TruGreen is a Memphis, Tenn.-based lawn care company.

Alvogen shopping add-on

Alvogen is going out to lenders with a $55 million add-on term loan talked at Libor plus 500 bps with a 1% Libor floor and an original issue discount that is still to be determined, according to a market source.

The spread and floor on the add-on term loan match the existing term loan, and all of the debt is getting 101 soft call protection for six months, the source said.

No formal call is being held to launch the add-on.

Jefferies Finance LLC is leading the deal that will be used for general corporate purposes and to potentially fund a portion of the acquisition of County Line Pharmaceuticals, a Wisconsin-based specialty generic pharmaceutical company.

Alvogen is a generic pharmaceutical company.

Premiere readies deal

Premiere Global Services plans to hold a lender call at 10 a.m. ET on Thursday to launch a $600 million credit facility, according to a market source.

The facility consists of a $50 million five-year revolver and a $550 million six-year first-lien term loan, the source said.

Barclays, SunTrust Robinson Humphrey Inc. and Macquarie Capital (USA) Inc. are leading the deal that will be used to refinance debt put in place in December to fund the buyout of the company by Siris Capital Group LLC.

Premiere Global is an Atlanta-based provider of collaboration software and services.

ERT on deck

ERT set a bank meeting for 1 p.m. ET on Thursday to launch a $540 million credit facility that will be used to fund its previously announced buyout by Nordic Capital Fund VIII from Genstar Capital, a market source remarked.

The facility consists of a $45 million five-year revolver and a $495 million seven-year covenant-light first-lien term loan, the source continued.

Goldman Sachs Bank USA and Bank of America Merrill Lynch are leading the deal.

The company also plans to use $220 million of privately-placed second-lien financing and equity to fund the buyout.

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

ERT is a Philadelphia-based provider of patient data collection solutions for use in clinical drug development.

Pinnacle coming soon

Pinnacle Entertainment scheduled a bank meeting for 11 a.m. ET on Wednesday to launch its $350 million seven-year term loan B, according to a market source.

J.P. Morgan Securities LLC is the left lead on the deal that will be used to refinance existing debt and for general corporate purposes.

The company is currently working towards the spin-off the operating business and the real property of Belterra Park Gaming & Entertainment (OpCo) into a separately traded public company and the sale of its remaining real estate assets (PropCo) to Gaming & Leisure Properties Inc.

In addition to the term loan B, the debt commitment for the spin-off includes a $400 million five-year revolver, a $185 million five-year term loan A and $300 million of senior notes

Closing is subject to customary conditions, regulatory approvals and the approval of Gaming & Leisure and Pinnacle’s shareholders.

Pinnacle is a Las Vegas-based owner and operator of gaming entertainment properties.

© 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.