Toys 'R' Us lifts size again, breaks; Spectrum rises; Airvana tweaks deal; Wyle sets launch

By Sara Rosenberg

New York, Aug. 17 - Toys 'R' Us Inc. upsized its term loan for a second time due to strong market interest and then proceeded to free up for trading, with levels quoted above its original issue discount price.

Also in the secondary market, Spectrum Brands Holdings Inc.'s term loan headed higher after the company released quarterly results that showed a year-over-year improvement in net sales and adjusted EBITDA.

In other news, Airvana Inc. increased the size of its term loan and widened pricing, Wyle Inc. firmed timing on the launch of its add-on, and Warner Chilcott plc tightened the original issue discount on its term loan B and is expected to give out allocations shortly.

Additionally, the books on Centerplate Inc. are starting to come together as the leads are talking the deal at higher pricing, with a couple of anchor orders in and interest being seen from some other investors as well.

Toys 'R' Us ups size

Toys 'R' Us increased the size of its six-year secured term loan (B1/BB-/B-) to $700 million from a most recent size of $650 million and an original size at launch of $500 million, according to a market source.

The first upsizing was done when the company decided to sell $350 million of senior secured notes, instead of $500 million. The notes priced on Monday at par to yield 7 3/8%.

Pricing on the term loan stayed in line with initial talk at Libor plus 450 basis points with a 1.5% Libor floor and an original issue discount of 981/2. There is 101 soft call protection for one year.

Bank of America, Goldman Sachs and JPMorgan are the lead banks on the deal, with Bank of America the left lead.

Toys 'R' Us starts trading

Following the latest size change, Toys 'R' Us' term loan hit the secondary market, with levels quoted at 99 bid, 99 ½ offered on the break and then moving up to 99 ¾ bid, par 1/8 offered, according to a trader.

Proceeds from the loan and the notes will be used to repay in full all obligations outstanding under the company's existing $800 million secured term loan and $181 million senior unsecured facility.

The incremental proceeds raised from the second term loan upsizing will be used for general corporate purposes, a source remarked.

Toys 'R' Us is a Wayne, N.J.-based toy retailer.

Spectrum Brands inches up

Spectrum Brands' term loan gained a little ground in trading on Tuesday after numbers were announced for the company's third fiscal quarter, according to a trader.

The term loan was quoted at 101 bid, 101½ offered, up from par ¾ bid, 101¼ offered, the trader said.

For the third fiscal quarter, Spectrum Brands reported consolidated net sales of $653.5 million, up 10.9% from $589.4 million in the third quarter of fiscal 2009.

Consolidated adjusted EBITDA for the quarter was $124.1 million, up from $122.8 million in the prior year.

And, net loss for the quarter was $86.5 million, or $2.53 per diluted share, compared with a net loss of $36.5 million, or $0.71 per diluted share, last year.

Spectrum Brands is an Atlanta-based consumer products company.

Airvana reworks loan

Moving back to the primary market, Airvana came out with some changes to its four-year term loan, including increasing the size and the spread, according to a market source.

The term loan is now sized at $360 million, up from $330 million, and pricing is Libor plus 900 bps, up from official talk at launch of Libor plus 800 bps to 850 bps, the source said.

The 2% Libor floor and original issue discount of 98 were left unchanged.

Prior to the deal's bank meeting, rumor was that the term loan was being whispered at Libor plus 700 bps with a 2% Libor floor and an original issue discount of 97 to 98, and it was said that the size was flexible, with the ability for an increase based on demand.

The loan includes amortization and a 100% excess cash flow sweep.

Airvana led by three

Jefferies, Societe Generale and Macquarie are the lead banks on Airvana's term loan, with Jefferies the left lead.

Proceeds will be used to refinance existing debt and to pay a dividend. This dividend was increased as a result of the term loan upsizing.

However, leverage is actually lower than previously expected, even with the upsizing, since the company's LTM EBITDA increased as of July. Leverage is now just under 2.0 times, down modestly from 2.0 times level, the source added.

Airvana is a Chelmsford, Mass.-based provider of mobile broadband network infrastructure products. In April, the company was acquired by 72 Mobile Holdings LLC, an entity that was formed by S.A.C. Private Capital Group LLC, GSO Capital Partners, Sankaty Advisors LLC and ZelnickMedia.

Wyle timing emerges

Wyle has scheduled a conference call for 10 a.m. ET on Wednesday to launch its proposed $205 million term loan add-on that is being completed via an amendment to the existing credit facility, according to a market source.

Barclays Capital and JPMorgan are the lead banks on the deal that will be used to help fund the acquisition of CAS Inc. from ITT Corp.

Other funding for the transaction will come from cash on hand and about $20 million of equity from the company's controlling shareholder, Court Square Capital Partners.

Wyle expected leverage

Following the transaction, Wyle's pro forma total leverage is anticipated to be roughly 5.5 times, and the combined entity will have pro forma 2009 revenues of about $1 billion.

Closing of the acquisition is subject to review and approval by regulatory authorities such as the Federal Trade Commission and other customary conditions.

Wyle is an El Segundo, Calif.-based provider of high-tech systems engineering, testing and information technology services. CAS is a Huntsville, Ala.-based provider of systems engineering and technical assistance for of military applications.

Warner Chilcott lowers OID

Warner Chilcott reduced the original issue discount on its $1 billion 51/2-year term loan B to 99 from 981/2, asked for recommitments by 3 p.m. ET on Tuesday and is expected to give out allocations as early as Wednesday, according to a market source.

Pricing on the term loan B was left intact at Libor plus 425 bps with a 2.25% Libor floor, and there is still 101 soft call protection for one year, the source said.

Also unchanged was the company's $500 million four-year term loan A, which is priced at Libor plus 425 bps as well.

JPMorgan, Bank of America and Goldman Sachs are the lead banks on the $1.5 billion deal (Ba3) that will be used, along with $750 million of senior unsecured notes that priced at par to yield 7¾%, to fund a special dividend to the company's ordinary shareholders of $8.50 per share, or about $2.15 billion.

Warner Chilcott seeks amendment

In connection with the new debt, Warner Chilcott is seeking an amendment to its existing credit facility to allow for the financing and the dividend payment.

As part of the amendment, existing lenders are being offered a 50 bps increase in spread and 101 soft call protection on the term loan B.

Lenders are also being offered a 37.5 bps consent fee.

Payment of the dividend is expected to take place before the end of the third quarter.

Warner Chilcott is an Ireland-based specialty pharmaceutical company.

Centerplate filling out

Centerplate's $194 million term loan has started to fill out as the deal is being talked at wider pricing, although the specifics on the spread are not yet available, according to a market source.

At launch, the term loan B was presented at Libor plus 625 bps to 675 bps with a 2% Libor floor and an original issue discount of 98.

The company's $314 million credit facility (B3/B+) also includes a $70 million revolver and a $50 million term loan A.

Macquarie, UBS and BMO Capital Markets are the lead banks on the deal that will be used to refinance existing debt and fund a dividend payment.

Centerplate is a Stamford, Conn.-based provider of food and beverage concessions, high-end catering and merchandise services in sports facilities, convention centers and other entertainment facilities.

Pinnacle Foods closes

In more happenings, Pinnacle Foods Finance LLC closed on its $442.3 million senior secured term loan D (Ba3/B+) on Tuesday that is priced at Libor plus 425 bps with a 1.75% Libor floor and was issued at par, according to an 8-K filed with the Securities and Exchange Commission.

During syndication, pricing firmed up at the tight end of the initial Libor plus 425 bps to 450 bps guidance.

Barclays, Bank of America and Credit Suisse acted as the lead banks on the loan that was used to refinance the company's existing $850 million term loan C due 2014 that is priced at Libor plus 500 bps with a 2.5% Libor floor and was sold at an original issue discount of 98.

Pinnacle Foods is a Mountain Lakes, N.J.-based manufacturer and distributor of branded packaged foods.

Gentiva wraps acquisition

Gentiva Health Services Inc. completed its acquisition of Odyssey HealthCare Inc. for $27 per share, for an aggregate purchase price of about $1 billion.

To help fund the transaction, Gentiva got a new $875 million senior credit facility (Ba2/BB-), consisting of a $125 million revolver, a $200 million five-year term loan A and a $550 million six-year term loan B.

Pricing on the term loan A and the term loan B is Libor plus 500 bps with a 1.75% Libor floor. The term loan A was sold at 98, and the term loan B was sold at 96. There is soft call protection of 102 in year one and 101 in year two under the term loan B.

During syndication, the term loan B was downsized from $600 million, pricing was increased from Libor plus 450 bps to 475 bps, the discount was widened from 98, and the soft call protection was sweetened from just 101 in year one. Also, pricing on the term loan A was increased from Libor plus 400 bps, the floor was lifted from 1.5% Libor floor and the discount widened from 981/2.

Bank of America, GE Capital, Barclays Bank and SunTrust acted as the joint lead arrangers and bookrunners on the deal for the Atlanta-based home health care provider.

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