NRG, ABB/Con-Cise, PolyOne break; U.S. Foods, Microsemi, Affinity Gaming, Forterra revised

By Sara Rosenberg

New York, June 14 – NRG Energy Inc.’s term loan B made its way into the secondary market on Tuesday, with levels bid right around the original issue discount, and deals from ABB/Con-Cise Optical Group LLC and PolyOne Corp. freed up as well.

In more trading happenings, Toys ‘R’ Us Inc.’s term loan B-4 was stronger on plans to refinance the company’s notes and Neiman Marcus Group LLC’s term loan B was down with the release of third fiscal quarter numbers.

Moving to the primary market, U.S. Foods Inc. downsized its term loan B, finalized pricing at the low end of talk, added a step-down and revised the issue price, and Microsemi Corp. lowered the spread on its term loan B and widened the original issue discount talk.

Furthermore, Affinity Gaming set pricing on its term loan at the tight end of talk and modified the issue price, and Forterra (Stardust Finance Holdings Inc.) upsized its incremental first-lien term loan.

Also, Bombardier Recreational Products Inc., Patterson Medical, Mediware Information Systems Inc., Grocery Outlet Inc. (GOBP Holdings Inc.) and Service King Collision Repair Centers released price talk on their deals with launch, and Royal Oak Enterprises LLC joined this week’s new issue calendar.

NRG hits secondary

NRG Energy set pricing on its $1.9 billion seven-year senior secured covenant-light term loan B (BB+) at Libor plus 275 basis points, the high end of the Libor plus 250 bps to 275 bps talk. The loan then freed up for trading on Tuesday, with levels seen at 99½ bid, 99 7/8 offered, according to a trader.

As before, the term loan B has a 0.75% Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months.

Citigroup Global Markets Inc. and Morgan Stanley Senior Funding Inc. are leading the deal that will be used to refinance an existing senior secured term loan B due in 2018.

Closing is targeted for the week of June 20.

NRG Energy is a wholesale power generation company with headquarters in Princeton, N.J., and Houston.

ABB/Con-Cise starts trading

ABB/Con-Cise Optical Group’s senior secured credit facility broke too, with the $370 million seven-year first-lien covenant-light term loan B quoted at 99½ bid, par offered, according to a trader.

Pricing on the first-lien term loan B is Libor plus 500 bps with a 1% Libor floor, and it was sold at an original issue discount of 99. The tranche has 101 soft call protection for six months.

During syndication, the term loan B was upsized from $350 million. Pricing finalized at the high end of the Libor plus 475 bps to 500 bps talk and the discount was set at the tight end of the 98.5 to 99 talk.

The company’s $630 million credit facility also includes a $100 million five-year revolver and a $160 million eight-year second-lien term loan that was privately placed.

Revolver pricing is Libor plus 500 bps with no Libor floor, after firming during syndication at the wide end of the Libor plus 475 bps to 500 bps guidance.

ABB/Con-Cise lead banks

Morgan Stanley Senior Funding Inc., Bank of America Merrill Lynch, Capital One, Deutsche Bank Securities Inc. and RBC Capital Markets LLC are the leads on ABB/Con-Cise’s credit facility.

Proceeds will be used to refinance existing debt and to fund a shareholder dividend, the size of which was increased with the recent term loan B upsizing.

Closing is expected on June 15.

ABB/Con-Cise is a Coral Springs, Fla. optical distributor.

PolyOne frees up

PolyOne’s $548.6 million senior secured covenant-light term loan B due Nov. 12, 2022 also began trading, with levels quoted at par bid, par ½ offered, a trader remarked.

Pricing on the loan is Libor plus 275 bps with a 0.75% Libor floor and it was issued at par. The debt has 101 soft call protection for six months.

Citigroup Global Markets Inc. is leading the deal that is being used to reprice an existing term loan B from Libor plus 300 bps with a 0.75% Libor floor.

PolyOne is an Avon Lake, Ohio-based provider of specialized polymer materials, services and solutions.

Toys ‘R’ Us rises

Also in trading, Toys ‘R’ Us’ term loan B-4 gained to 87½ bid, 89½ offered from about 84½ bid, 86½ offered on the back of news that the company is working on refinancing plan to extend debt maturities, according to a trader.

The company disclosed on Monday that noteholders of about half of its $850 million in debt maturing in 2017 and 2018 have agreed to support the refinancing by participating in an exchange offer.

The plan is to refinance up to about 89% of the existing notes in the exchange offer.

Additionally, the company disclosed that a third party has agreed to purchase up to $50 million of new debt, subject to the successful completion of the exchange offer.

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

Neiman softens

Neiman Marcus’ term loan B dipped to 89½ bid, 90½ offered from 90 bid, 91 offered in reaction to the company’s third fiscal quarter results, a trader said.

For the quarter, the company reported total revenues of $1.17 billion, a decrease of 4.2% compared to total revenues of $1.22 billion in the third quarter of fiscal year 2015.

Net earnings for the quarter were $3.8 million, down from net earnings of $19.8 million in the comparable period last year.

And, adjusted EBITDA for the quarter was $173.2 million, compared to $202.6 million in the prior year.

Neiman is a Dallas-based luxury retailer.

U.S. Foods changes emerge

Switching to the primary market, U.S. Foods reduced its seven-year senior secured covenant-light term loan B to $2.2 billion from $2.3 billion, set pricing at Libor plus 325 bps, the low end of the Libor plus 325 bps to 350 bps talk, added a step-down to Libor plus 300 bps when net secured leverage is less than 3.25 times and moved the original issue discount to 99.75 from 99.25, according to a market source.

The term loan B still has a 0.75% Libor floor and 101 soft call protection for six months.

Recommitments are due at noon ET on Wednesday, with allocations expected thereafter, the source said.

Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Bank of America Merrill Lynch, BMO Capital Markets, Natixis, Wells Fargo Securities LLC, ING, J.P. Morgan Securities LLC and Morgan Stanley Senior Funding Inc. are leading the loan that will be used with $600 million of senior notes, upsized from $500 million, to refinance an existing $2.04 billion term loan B, $258 million of senior notes and a $472 million CMBS facility.

Closing is expected on or before June 30.

U.S. Foods is a Chicago-based broadline foodservice distributor.

Microsemi reworks term B

Microsemi cut pricing on its $854 million senior secured covenant-light term loan B due Jan. 15, 2023 to Libor plus 300 bps from Libor plus 325 bps and revised the original issue discount talk to 99.5 to 99.75 from par, while leaving the 0.75% Libor floor and 101 soft call protection for six months unchanged, a market source said.

Also, an additional technical tax structure amendment was posted on the transaction, the source continued.

Recommitments for the term loan B were due at 3 p.m. ET on Tuesday.

The company is also seeking a $250 million incremental senior secured term loan A due Jan. 15, 2021 that was launched with talk of Libor plus 250 bps, subject to a grid, with no Libor floor and a discount of 99.625.

Proceeds from Microsemi’s term loan B will be used to reprice an existing term loan B and the term loan A will be used to refinance a portion of the existing term loan B.

Morgan Stanley Senior Funding Inc. is leading the $1,104,000,000 in senior secured term loans (BB).

Term loan A and revolver consents are due at 3 p.m. ET on June 22, the source added.

Microsemi is an Aliso Viejo, Calif.-based provider of semiconductor solutions.

Affinity updates pricing

Affinity Gaming firmed pricing on its $300 million seven-year first-lien term loan at Libor plus 400 bps, the tight end of the Libor plus 400 bps to 425 bps talk and moved the original issue discount to 99.5 from 99, according to a market source.

The term loan still has a 1% Libor floor and 101 soft call protection for six months.

Commitments are due at noon ET on Wednesday, accelerated from Friday, the source said.

The company’s $375 million credit facility (B1/BB-) also includes a $75 million undrawn revolver.

Credit Suisse Securities (USA) LLC, Macquarie Capital (USA) Inc. and Fifth Third Bancorp are leading the deal that will be used with $90 million of cash on hand to call the company’s $200 million of 9% senior notes due 2018 and repay its existing $180 million secured term loan.

Total leverage is 4.2 times.

Affinity Gaming is a Las Vegas-based casino owner and operator.

Forterra tweaks size

Forterra raised its fungible incremental covenant-light first-lien term loan due March 13, 2022 to $345 million from $270 million, and left pricing at Libor plus 550 bps with a 1% Libor floor and an original issue discount of 99, according to a market source.

The spread and floor on the incremental term loan matches existing term loan pricing, and all of the first-lien term debt is getting 101 soft call protection for six months.

Recommitments were due at 5 p.m. ET Tuesday, the source said.

Credit Suisse Securities (USA) LLC is leading the deal that will be used to fund a distribution to shareholders.

Forterra, formerly known as Hanson Building Products, is an Irving, Texas-based manufacturer of drainage and water transmission pipe and products.

Vencore allocates

Vencore Inc. allocated its new deal after upsizing its first-lien term loan due Nov. 23, 2019 to $550.9 million from a revised amount of $545 million and an initial size of $515 million, and modifying the size of its second-lien term loan due May 23, 2020 to $244.2 million from a revised amount of $240 million and an initial amount of $270 million, a market source said.

Pricing on the first-lien term loan is Libor plus 475 bps with a 1% Libor floor, and it was sold at an original issue discount of 99.28. The debt has 101 soft call protection for one year.

The second-lien term loan is priced at Libor plus 875 bps with a 1% Libor floor, and was issued at a discount of 98. This tranche has call protection of 102 in year one and 101 in year two.

Previously in syndication, pricing on the first-lien term loan was cut from Libor plus 500 bps and the discount was changed from 99.25, and pricing on the second-lien term loan was trimmed from Libor plus 900 bps and the discount firmed at the tight end of the 97.5 to 98 talk.

UBS Investment Bank is leading the $795.1 million loan transaction that is expected to close on Friday and will be used to refinance existing debt and fund a dividend.

Vencore, formerly known as the SI Organization Inc., is a Chantilly, Va.-based provider of information solutions, engineering and analysis to the U.S. intelligence community, Department of Defense and agencies.

Harland wraps at terms

Harland Clarke Holdings Corp. completed syndication of its $800 million term loan B-5 (B1/BB-) due December 2019 at talk of Libor plus 600 bps with a 1% Libor floor, an original issue discount of 97 and 101 soft call protection for one year, according to a market source.

Credit Suisse Securities (USA) LLC, Bank of America Merrill Lynch, J.P. Morgan Securities LLC, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Jefferies Finance LLC, Macquarie Capital (USA) Inc. and PNC Capital Markets are leading the deal that will be used to refinance an existing term loan B-2 and a portion of the company’s term loan B-3.

Harland Clarke is a San Antonio-based provider of media delivery, payment solutions and marketing services.

Bombardier releases terms

Bombardier Recreational Products held its lender call on Tuesday, launching its $700 million amended and restated term loan B (Ba3) due 2023 with talk of Libor plus 300 bps with a 0.75% Libor floor, an original issue discount of 99 to 99.25 and 101 soft call protection for six months, according to a market source.

In addition to the term loan, the company is getting a C$425 million amended and restated revolver (Baa3) due 2021.

RBC Capital Markets, BMO Capital Markets, Citigroup Global Markets Inc. and TD Securities are leading the deal that will be used with cash on hand to replace an existing C$350 million revolver due 2018 and a $792 million term loan B due 2019.

Pro forma for the transaction, total net leverage is 1.9 times.

Bombardier Recreational is a Valcourt, Quebec-based designer, manufacturer, distributor and marketer of motorized recreational vehicles and powersports engines.

Patterson talk surfaces

Patterson Medical came out with talk of Libor plus 425 bps with a 1% Libor floor, an original issue discount of 99 to 99.5 and 101 soft call protection for six months on its $330 million covenant-light term loan B due August 2022 that launched with a morning bank meeting, a source remarked.

Commitments are due on June 23, the source added.

Deutsche Bank Securities Inc., Barclays, Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC are leading the deal.

Proceeds will be used to help fund the acquisition of Performance Health from Gridiron Capital, which is expected to close this summer, subject to customary conditions.

Patterson Medical, a Madison Dearborn Partners portfolio company, is a Warrenville, Ill.-based distributor of rehabilitation, sports medicine and assistive patient products. Performance Health is an Akron, Ohio-based manufacturer and supplier of consumer branded health, wellness and self-care products.

Mediware discloses guidance

Mediware Information Systems launched with a bank meeting its $300 million term loan with talk of Libor plus 450 bps to 475 bps with a 1% Libor floor and an original issue discount of 99 to 99.5, according to a market source.

The company’s $330 million credit facility also includes a $30 million revolver.

SunTrust Robinson Humphrey Inc. is leading the deal that will be used to refinance existing debt and fund a distribution to shareholders.

Mediware is a Lenexa, Kan.-based provider of specialized healthcare IT solutions for automating and managing complex health care processes.

Grocery Outlet seeks add-on

Grocery Outlet launched on an afternoon lender call a $60 million senior secured add-on first-lien term loan (B-) due Oct. 21, 2021 talked at Libor plus 375 bps to 400 bps with a 1% Libor floor and an original issue discount of 98.76, a market source said.

Commitments are due at noon ET on Thursday, the source added.

Morgan Stanley Senior Funding Inc. is leading the deal that will be used to help finance a distribution to sponsor Hellman & Freeman and company management.

Grocery Outlet is an Emeryville, Calif.-based grocery store operator.

Service King launches

Service King held a lender call in the afternoon, launching a fungible $75 million add-on term loan B with price talk of Libor plus 350 bps with a 1% Libor floor and an original issue discount in a 99.5 context, according to a market source.

Commitments are due at noon ET on Friday, the source said.

Bank of America Merrill Lynch, J.P. Morgan Securities LLC, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and Macquarie Capital (USA) Inc. are leading the deal that will be used for general corporate purposes.

Service King is a Dallas-based operator of a chain of automobile body repair centers.

Royal Oak on deck

Royal Oak Enterprises set a bank meeting for Thursday to launch a $365 million credit facility, according to a market source.

The facility consists of a $40 million revolver and a $325 million covenant-light term loan B, the source said.

SunTrust Robinson Humphrey Inc. is leading the deal that will be used to help fund the buyout of the company by Mariposa Capital.

Royal Oak is a Roswell, Ga.-based maker of charcoal products.

Kindred closes

In other news, Kindred Healthcare Inc. closed on its fungible $200 million add-on term loan, according to a news release.

Pricing on the term loan is Libor plus 325 bps with a 1% Libor floor, and it was sold at an original issue discount of 99.05. There is 101 soft call protection for six months.

J.P. Morgan Securities LLC led the deal that was used to pay down ABL revolving credit facility borrowings.

Kindred Healthcare is a Louisville, Ky.-based health care services company.

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