Gibraltar adds step down, breaks for trading; Acosta, Workflow break; Capital Auto ups size, spread

By Sara Rosenberg

New York, Dec. 5 - Gibraltar Industries Inc. added a step down in pricing to its term loan B tranche right before allocating and freeing the deal for trading on Monday afternoon.

Also breaking for trading on Monday was Acosta Sales Co. Inc., whose first-lien term loan was quoted in the 101 context and second-lien term loan was quoted in the 102 context, and Workflow Management Inc., whose first-lien term loan barely made it to par.

In primary happenings, Capital Automotive REIT increased the size of its term loan after deciding to drop its bond offering, increased pricing on the entire credit facility by 25 basis points and added call premiums to the term loan tranche.

Gibraltar Industries added a step down to its $230 million seven-year senior secured term loan B (Ba1/BB) on Monday morning, under which pricing can drop to Libor plus 150 basis points when total leverage is less than 2.5x and upon receipt of Sept. 30, 2006 numbers, according to a market source. Currently, pricing on the tranche is set at Libor plus 175 basis points.

Shortly after making this tweak, the syndicate allocated the term loan, freeing the paper for trading.

On the break, the term loan B was being quoted at and trading in the context of par 3/8 bid, par 7/8 offered, the source said. However, quickly after the paper started trading, levels headed higher, moving to par ½ bid, 101 offered where they stayed for the remainder of the session, the source added.

Proceeds from the term loan and from a $200 million 8% senior subordinated notes offering that priced at 98.325 to yield 8¼%, will be used to repay a $300 million term loan drawn down by the company for the purpose of acquiring Alabama Metal Industries Corp. and some outstanding borrowings under the company's existing $300 million revolver.

KeyBank is the lead arranger and administrative agent on the Buffalo, N.Y., steel products and services company's term loan.

Acosta breaks

Acosta allocated its credit facility on Monday, with the $515 million seven-year first-lien term loan freeing up for trading in the 101 bid, 101¼ offered region and the $100 million 71/2-year second-lien term loan freeing up for trading in the 102 bid, 102¼ offered region, according to a trader.

The first-lien term loan is priced with an interest rate of Libor plus 225 basis points and the second-lien term loan is priced with an interest rate of Libor plus 575 basis points - right in the middle of original price talk of Libor plus 550 to 600 basis points.

Acosta's $675 million credit facility also contains a $60 million six-year revolver.

Wachovia and Goldman Sachs are the lead banks on the deal, with Wachovia the left lead on the revolver and first-lien term loan and Goldman the left lead on the second-lien term loan.

Proceeds will be used for a dividend recapitalization.

Acosta is a Jacksonville, Fla., sales and marketing agency to the consumer packaged goods industry.

Workflow near par

Workflow Management's credit facility also hit the secondary on Monday, with the $275 million six-year term loan B (B2/BB-) quoted at par offered, no bid, according to a trader.

"The term loan B was offered to investors during syndication with an original issue discount of 991/2," the trader said in explanation of why levels were somewhat low.

Pricing on the term loan B is set at Libor plus 400 basis points, and the tranche contains 101 soft call protection.

Workflow's $425 million credit facility, which actually closed last week, also contains a $40 million five-year revolver (B2/BB-) at Libor plus 400 basis points and a $110 million seven-year second-lien term loan (B3/B) at Libor plus 825 basis points.

The second-lien term loan has call protection of 103 in year one, 102 in year two and 101 in year three.

The revolver contains a 50 basis point commitment fee.

The company also closed on $30 million of 71/4-year holdco mezzanine debt at 12% plus 4% pay-in-kind interest.

Originally, the deal was launched as a $40 million five-year revolver talked at Libor plus 300 basis points, a $300 million five-year first-lien term loan B (B2/BB-) talked at Libor plus 300 basis points and a $115 million seven-year second-lien term loan (B3/B) talked at Libor plus 700 basis points - but, sizes, pricing and call protection were all tweaked during syndication.

Credit Suisse First Boston, National City Bank and Royal Bank of Canada acted as joint lead arrangers on the deal.

Proceeds were used to fund the acquisition of The Relizon Co.

Workflow Management is a New York-based full-service print and promotional products provider.

El Paso dips on exchange offer

El Paso Corp.'s revolver and term loan were off about an eighth of a point on Monday as the company announced plans to exchange all properly tendered and accepted notes previously issued by its subsidiary, El Paso CGP Co., according to a trader.

At the end of the day, the revolver was quoted at par 1/8 bid, par ½ offered and the term loan was quoted at par 3/8 bid, par ¾ offered, the trader said.

Under the exchange, El Paso is offering to pay for each CGP note that is properly tendered, by issuing a new El Paso note in a principal amount equal to the exchange price. Each new El Paso note issued in exchange for a CGP note will have the same interest rate, interest payment dates, redemption rights, if any, and maturity.

The Houston-based natural gas company's exchange offer is scheduled to expire on Dec. 30.

Charter up in trading

Charter Communications Inc.'s term loan B moved up by about an eighth to a quarter of a point on Monday, according to a trader, who said that there was just some trading in the name pushing it higher.

The term loan closed out the day quoted at par ¼ bid, par ½ offered, the trader added.

Charter is a St. Louis-based provider of broadband services.

Calpine bid falls off

Calpine Corp.'s second-lien bank debt took a breather on Monday, dropping a bit lower on the bid side, after spending all of last week trading higher and higher.

The San Jose, Calif., power company's second-lien bank debt was quoted at 77½ bid, 79 offered, according to a trader, down on the bid side from Friday's levels of 78, 80 offered.

All last week, Calpine's second-lien kept gaining ground as investors were thinking about recovery estimates in a potential Chapter 11 scenario.

Bankruptcy talk has been compounding as the company removed executive management, recived ratings downgrades from Moody's Investors Service and Standard & Poor's downgraded, and stated that there is a substantial risk that it will not have sufficient cash to satisfy the court ruling that it must restore to the Bank of New York collateral account approximately $313 million, plus accrued interest at 3.5% per annum, and its ongoing debt service obligations and operating expenses.

Capital Auto tweaks deal

Capital Automotive REIT upsized its term loan B by $530 million after pulling it bond offering, added call premiums against a refinancing to the tranche and flexed pricing higher on both the term loan and the revolver, according to a market source.

The five-year term loan B is now sized at $1.95 billion, up from $1.42 billion, pricing was raised to Libor plus 175 basis points from Libor plus 150 basis points and call protection of 102 in year one and 101 in years two and three was added, the source said. The call protection relates to refinancings. Prepayments made from an initial public offering, asset sales and/or excess cash flow are not covered by the call protection.

In addition, pricing on the $250 million four-year revolver was also raised to Libor plus 175 basis points from original price talk of Libor plus 150 basis points, the source said.

The decision to increase the size of the term loan B came on the heels of the company's decision to cancel its proposed $500 million senior notes offering. The extra $30 million of liquidity that will be raised through the term loan B upsizing is basically just for extra cash on the balance sheet, the source explained.

Lehman is the lead bank on the now $2.2 billion credit facility (Ba1/BB+).

Proceeds from the facility will be used to help fund DRA Advisors LLC's acquisition of Capital Automotive.

Under the terms of the agreement, holders of the company's common shares will receive $38.75 per share payable in cash. The total transaction value is about $3.4 billion, including the assumption of debt and preferred shares.

Capital Automotive is a McLean, Va., specialty finance company for automotive retail real estate.

JohnsonDiversey flexes up

JohnsonDiversey Holdings Inc. increased pricing across the board by 25 basis points on its $1.025 billion credit facility (B1/B+/BB-) and increased the ticking fee on its delayed-draw term loan tranche, according to a market source.

Pricing on the $150 million revolver, a $775 million six-year term loan B and a $100 million delayed-draw term loan is now set at Libor plus 250 basis points, up from original price talk at launch of Libor plus 225 basis points.

Furthermore, the ticking fee on the delayed-draw term loan, which is available for one year with a final maturity in five years, is now set at 200 basis points, up from the original 175 basis points fee, the source said.

The revolver still contains an undrawn fee of 75 basis points.

Citigroup is the lead bank on the deal that will be used to refinance existing debt and provide extra liquidity as the company proceeds with its restructuring plan that includes some job cuts, plant closures and possible selling of non-core assets.

JohnsonDiversey is a Sturtevant, Wis., provider of commercial cleaning, sanitation and hygiene solutions.

Tupperware closes

Tupperware Corp. closed on its new $975 million credit facility (Ba2/BB) consisting of a $200 million five-year revolver and a $775 million seven-year term loan with an interest rate of Libor plus 150 basis points, according to a company news release.

Bank of America acted as the lead bank that was used to fund the purchase of Sara Lee Corp.'s direct-selling businesses and retire $250 million of existing debt.

In connection with the acquisition Tupperware changed its name to Tupperware Brands Corp.

Tupperware is an Orlando, Fla., direct seller of food storage, preparation and serving items.

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