Acadia, Manitowoc Foodservice, Vizient bring deals; Northeast winter storm dampens trading

By Paul A. Harris

Portland, Ore., Jan. 25 – Winter weather in the Northeastern part of the United States dampened down trading in the bank loan market on Monday, according to a trader based there.

“The market was flat to down maybe a quarter of a point,” the source said, adding that it was absolutely dead.

Bank loans, which demonstrated notable resilience to recent extreme volatility in the global capital markets, appeared to succumb to that volatility in the middle part of last week, the source said.

“It seemed to take hold last Wednesday around noon,” the trader recalled.

“The market fell a point.”

However, news circulated on Thursday that a couple of CLOs were ramping up, and stability returned on Thursday and Friday, the source recounted.

That stability notwithstanding, high-beta credits remain susceptible to the least amount of negative news, the trader remarked.

There was a modicum of news in the primary market on Monday.

Early-to-mid week lender calls and meetings were announced for Acadia Healthcare Co. Inc., Manitowoc Foodservice Inc. and Vizient, Inc.

Vizient launches Tuesday

Vizient plans to launch $1.6 billion of new bank debt at a Tuesday morning bank meeting.

The deal, which is being led by sole bookrunner Barclays, includes a $1,525,000,000 first-lien term loan and a $75 million revolver.

The Irving, Texas-based network of not-for-profit health care organizations plans to use the proceeds to fund the acquisition of MedAssets’ Spend and Clinical Resource Management segment.

Manitowoc spinoff deal

Manitowoc Foodservice plans to launch a $975 million term loan B to lenders on Tuesday.

J.P. Morgan is leading the deal, which is talked at a 475-basis-points spread to Libor with a 1% Libor floor at 98 to 98.5.

The loan features a one-year soft call at 101.

Proceeds will be used to fund the spinoff of the New Port Richey, Fla.-based commercial foodservice equipment company, in a transaction expected to close in February.

Acadia starts Wednesday

Acadia Healthcare set a lender meeting on Wednesday for its $955 million senior secured term loan B.

Bank of America Merrill Lynch and Jefferies Finance LLC are the arrangers.

Proceeds will be used to help fund its acquisition of Priory Group.

The financing also includes a $390 million senior unsecured increasing rate bridge loan, which is expected to be take out with high yield bonds, sources say.

Under the agreement, Acadia will issue the seller 5,363,000 shares of common stock and pay cash consideration of about £1,275,000,000 for Priory.

Of the cash amount, about £925 million will be used to repay Priory outstanding debt.

Closing is expected by Feb. 16. The transaction is not subject to financing.

Acadia is a Franklin, Tenn.-based provider of inpatient behavioral health care services. Priory is a provider of behavioral health care services in the United Kingdom.

Central Securities launches

Central Security Group, Inc. was scheduled to take part in a lender call on Monday to launch a $50 million incremental first-lien term loan due Oct. 6, 2020 (B2/B-).

Commitments are due on Feb. 1.

The deal, via Credit Suisse Securities (USA) LLC, is an add-on to its existing term loan due Oct. 6, 2020 and will be fungible with the existing loan.

As with the existing loan, pricing features a 562.5-bps spread to Libor with a 1% Libor floor at 97.00.

There is soft call protection for six months at 101.

The Tulsa, Okla.-based provider of alarm monitoring services plans to use the proceeds to repay a draw on its revolving credit facility.

Cheniere announces facilities

Cheniere Energy Partners, LP announced in a Monday press release that it has mandated 13 financial institutions to act as joint lead arrangers for approximately $2.8 billion of new credit senior secured facilities.

The arrangers are MUFG, ABN Amro Capital USA LLC, SG CIB, Industrial and Commercial Bank of China Ltd., New York Branch, Intesa Sanpaolo, SPA, New York Branch, JPMorgan Chase Bank, Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corp., Morgan Stanley Senior Funding, Inc., Bank of America, Credit Suisse, HSBC Bank USA and Commonwealth Bank of Australia.

Proceeds will be used to prepay the Cheniere Creole Trail Pipeline, LP $400 million senior secured term loan, as well as to redeem or repay the roughly $1.7 billion senior notes due 2016 and the $420 million senior secured notes due 2020 issued by Sabine Pass LNG, LP, and for general business purposes of Cheniere Partners and its subsidiaries.

“Cheniere Partners is pleased to have the continued support of its key relationship banks for this refinancing,” Neal Shear, board chairman and interim CEO of Cheniere Partners stated in the release.

Following the close of the transaction the nearest debt maturity of Cheniere Partners will be in 2020, Shear added.

The borrower is a Houston-based LNG terminal, transmission and infrastructure company.

Select Medical term loan

Select Medical Corp. announced in a Monday press release that it plans to put in place a $400 million senior secured incremental term facility under its existing credit facility, for which JP Morgan has provided a debt commitment letter.

Select Medical is acquiring Physiotherapy Associates Holdings, Inc. for $400 million in cash. The transaction is expected to close in the first or second quarter of 2016.

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