Western Wireless edges up into 98 levels in strong secondary market

By Sara Rosenberg

New York, Sept. 2 - The secondary bank loan market was strong on Tuesday, generally speaking, with most names quoted higher on market technicals as investors searched for paper but could find little in the way of offerings. One such name cited was Western Wireless Corp.'s term loan B, which has now moved up into the 98's from last week's trading level around 971/2, according to a trader.

Western Wireless is a Bellevue, Wash. provider of rural wireless communications services.

"Everything is up today. No offerings. Everybody is looking for paper," the trader said.

Despite the strengthening, activity was on the quiet side as many people spent the day settling in after the long holiday weekend.

"Everybody is just recovering," a second trader added.

In primary news, Dean Foods Co. made some changes to its proposed amended and restated credit facility (Ba1/BB+), increasing the sizes of the pro rata tranches, bringing the total credit facility to $2.75 billion. Wachovia Securities and Bank One are the lead banks on the deal.

The facility now consists of a $1 billion revolver due 2007 with an interest rate of Libor plus 175 basis points, a $1 billion term loan A due 2007 with an interest rate of Libor plus 175 basis points and a $750 million term loan B due 2008 with an interest rate of Libor plus 200 basis points.

Originally, the deal was expected to be sized at $2.45 billion with the revolver and term loan A both expected to total $850 million each.

Other terms, such as pricing and tenor have remained the same throughout syndication.

Although the deal is basically viewed as a repricing of the existing loan, it was brought to market as a new deal, eliminating the need for 100% lender approval to reduce pricing on the tranches. Pricing on the existing facility is Libor plus 225 basis points on all three tranches.

In order to make the deal slightly more investor friendly, call protection at par ½ for the first nine months was added into the credit agreement terms.

Dean Foods is a Houston processor and distributor of milk and other dairy products.

Meanwhile, now that the holiday is behind the market, the pipeline for September is growing as two more new deals - Hanger Orthopedic Group Inc. and Tredegar Corp. - were added to the calendar on Tuesday.

Hanger Orthopedic is slated to launch a $150 million senior secured term loan B due 2009 (B+) on Friday. Price talk on the tranche is currently Libor plus 325 to 350 basis points.

Lehman and GE are the lead banks on the deal.

Proceeds will be used to fund the company's cash tender offer for its $150 million outstanding principal amount of 11.25% senior subordinated notes due 2009.

Hanger Orthopedic is a Bethesda, Md. provider of orthotic and prosthetic patient-care services.

Tredegar is scheduled to hold a bank meeting on Monday for a new $250 million credit facility, consisting of a $175 million five-year revolver and a $75 million five-year term loan A, both priced with an interest rate of Libor plus 125 basis points. Wachovia is the lead bank on the deal.

Proceeds will be used to refinance existing debt.

Tredegar is a Richmond, Va. manufacturer of plastic films and aluminum extrusions.

Following up, UniFirst Corp. closed on its new $285 million three-year revolver with an interest rate of Libor plus 200 basis points in conjunction with closing on its acquisition of the business and assets of Textilease Corp. for $178 million in cash, less assumed debt.

Fleet National Bank acted as sole lead arranger, sole bookrunner and administrative agent, and Sun Trust Bank acted as syndication agent.

"The Textilease acquisition is the largest and most significant acquisition we have ever made. The combination of our two companies will broaden our market penetration in the mid-Atlantic and Southeast areas. Textilease is one of the premier companies in the industry. They are a quality company with excellent people and customers. We're pleased to have them join the UniFirst family," said Ronald D. Croatti, president and chief executive officer, in a news release.

UniFirst is a Wilmington, Mass. provider of workplace uniforms and protective clothing.

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