Intelsat Jackson, Burger King deals price, trade higher; LCDX 18 index down 3/8 of a point

By Paul A. Harris

Portland, Ore., Sept. 26 - The bank loan market continued to generate a high news volume on Wednesday in spite of the fact that the Yom Kippur holiday thinned the ranks of market participants, sources said.

Intelsat Jackson Holdings SA priced its $3,218,000,000 Libor plus 325 basis points term loan B-1 at par, and it traded to par ½ offered.

And Burger King Corp. priced its $705 million term loan B at a Libor spread of 275 basis points and an original issue discount of 99.75, whereupon it broke to par bid, par ½ offered.

Secondary market activity was muted, according to a trader, who chalked up the fact to the holiday.

The LCDX 18 bank loan index ended the session down 3/8 of a point, at par 3/16 bid, par 11/16 offered, the trader said.

Nevertheless, the drag seen in the past few days in the high-yield market, which has widened from an all-time low composite yield to worst of 6.17% to 6.39% as of Tuesday's close, has not made itself apparent in the loan market, sources said on Wednesday.

CLOs are keeping loans well bid because they are a little bit immune to relative value changes, a trader explained.

Also, if indeed credit is undergoing some price deterioration, loans should make more sense than bonds, said a mutual fund manager who plays both.

That's because the price of loans should hold in much better than bonds, which can be subject to substantial moves lower when the bid fades, the investor added.

Intelsat prices

Intelsat Jackson's term loan B-1 has 25 bps step-down based on receiving a credit facility rating of B3 from Moody's Investors Service, the source said.

Also, the loan has a 1.25% Libor floor, a par offer price and 101 soft call protection for one year.

The company's $3,718,000,000 credit facility also includes a $500 million revolver.

Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC and J.P. Morgan Securities LLC are the lead banks on the deal.

Proceeds will be used to refinance and reprice existing debt, including a term loan that is priced at Libor plus 375 bps with a 1.5% Libor floor.

The transaction is an amendment to the existing senior secured credit facility.

Burger King allocates

Burger King's term loan B broke to par bid, par ½ offered, a trader said.

The Libor spread came on top of the Libor plus 275 basis points spread talk, which had tightened from earlier talk of 300 bps.

The B loan still has a 1% Libor floor and an original issue discount of 993/4.

As has been reported, with the tightened spread talk, 101 soft call protection for one year was added to the term loan B.

The company's credit facility (Ba3/BB) also includes a $1.03 billion term loan A due 2017.

Proceeds will be used to refinance $1.73 billion of existing term loan B debt.

J.P. Morgan Securities LLC, Barclays and Bank of America Merrill Lynch are the lead banks on the deal.

SkillSoft repricing

SSI Investments II Ltd., the corporate parent of business training software provider SkillSoft Ltd., completed the repricing of its $458 million of credit facilities.

The $50 million incremental term loan priced at 99 1/2, at the rich end of the 99 to 99½ discount talk.

The $407,825,000 term loan priced at par, on top of discount talk.

The spread came at Libor plus 375 basis points, the tight end of the 375 bps to 400 bps spread talk.

The deal has a 1.25% Libor floor.

There will be a 101 soft call in year one.

Morgan Stanley & Co., Barclays and Deutsche Bank Securities Inc. are the joint lead arrangers.

Proceeds will be used to fund the acquisition of ThirdForce Group plc.

Zayo gives guidance

Zayo Group LLC gave guidance for the repricing of $1.87 billion of its senior secured credit facility on Wednesday.

A $1.62 billion term loan due July 2, 2019 is talked at a Libor spread of 375 basis points to 400 bps with a 1.25% Libor floor at par. It features a 101 soft call through July 2, 2013, the same as the existing term loan.

A $250 million revolver due July 2, 2017 is talked with a Libor spread of 325 to 350 bps, also at par.

Commitments are due at 5 p.m. ET on Tuesday.

Morgan Stanley Senior Funding Inc. and Barclays are the lead banks on the deal.

National Mentor repricing

National Mentor Holdings Inc. guided the repricing of its $530 million term loan B with spread talk of Libor plus 475 to 500 basis points.

Current pricing is Libor plus 525 bps.

The repricing would decrease the Libor floor to 1.25% from the current 1.75%.

The term loan, which matures Feb. 9, 2017, comes with a one year soft call at 101.

UBS Investment Bank is leading the deal, which also includes a $75 million revolver due Feb. 9, 2016.

As reported, the bank meeting is set for 10 a.m. ET on Thursday in New York.

Brand Energy meeting

Brand Energy & Infrastructure Services, Inc. has scheduled a bank meeting for 10:30 a.m. ET on Thursday in New York City for its $700 million six-year term loan B.

The deal, being run by lead left bookrunner UBS Securities Inc., comes with spread talk of Libor plus 475 basis points to 500 bps with a 1.25% Libor floor.

Discount talk has the deal coming at 99.

The loan is callable at 101 in year one.

The $825 million facility also features a $75 million five-year revolver and a $50 million six-year funded letter of credit facility.

Proceeds will be used to refinance existing debt.

Telx sets lender call

Telx Group plans to host a lender call at 2 p.m. ET on Thursday, in part to discuss a repricing of $373 million of its credit facilities.

Morgan Stanley and TD Securities are the joint lead arrangers.

At issue are a $328 million term loan, a $35 million incremental term loan and a $10 million revolver.

ControurGlobal, Credit Suisse

ContourGlobal Power Holdings SA has planned a bank meeting to take place at 2 p.m. ET on Thursday in New York.

Under discussion will be a $350 million five-year first lien term loan.

Pricing is Libor plus 850 basis points with a 1.5% Libor floor, discounted to 97.5.

The deal becomes callable in two years at 102 and 101 in year three.

Credit Suisse Securities (USA) LLC is the lead.

The New York-based operator of power generating stations plans to use the proceeds to finance acquisitions and for general corporate purposes.

Shelf Drilling via Jefferies

Shelf Drilling International Holdings, Ltd. has planned an early October roadshow for a $475 million offering of senior secured notes and a $75 million term loan.

Jefferies & Co. is the bookrunner for the bonds and the bookrunner and arranger for term loan.

Proceeds, along with $645 million of equity, will be used to finance the acquisition of 38 drilling rigs from Transocean Inc. for $1.05 billion.

Shelf Drilling is a newly formed international shallow water offshore drilling contractor sponsored by Castle Harlan, CHAMP Private Equity and Lime Rock Partners.

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