Dollar Tree, Citgo Holding, Acadia Healthcare, US Farathane, Orica Chemicals changes emerge

By Sara Rosenberg

New York, Feb. 5 – In the primary market on Thursday, Dollar Tree Inc. reduced the size of its term loan B as its term loan A and bond offering were upsized, and the term loan B also underwent some modifications to pricing, offer price and call protection.

Also, Citgo Holding Inc. increased pricing on its term loan B while widening the original issue discount, Acadia Healthcare Co. Inc. tightened the spread and offer price on its term loan B, and US Farathane Corp. firmed pricing on its term loan at the wide end of guidance, modified the original issue discount and sweetened the call protection.

In addition, Orica Chemicals (Chemstralia Pty Ltd.) upsized its term loan, lifted pricing, revised the discount and extended the call protection, and DBRS and BATS Global Markets released talk on their new deals with launch.

Dollar Tree revised

Dollar Tree trimmed its seven-year term loan B on Thursday to $3.95 billion from $5.2 billion, reverse flexed pricing to Libor plus 350 basis points from talk at launch of Libor plus 375 bps to 400 bps, tightened the original issue discount to 99½ from 99, and extended the 101 soft call protection to one year from six months, according to a market source.

The term loan B still has a 0.75% Libor floor.

Another change made was that the five-year term loan A was lifted to $1 billion from $500 million, while pricing on the tranche remained at Libor plus 225 bps, the source said.

The company’s now $6.2 billion credit facility also includes a $1.25 billion five-year revolver that is priced at Libor plus 225 bps as well.

Recommitments were due at 3 p.m. ET on Thursday, the source continued.

J.P. Morgan Securities LLC, Wells Fargo Securities LLC, Bank of America Merrill Lynch, RBC Capital Markets LLC and U.S. Bank NA are leading the deal.

Dollar Tree cuts bonds

With the term loan B downsizing, Dollar Tree opted to upsize its bond offering to $3.25 billion from $2.5 billion, the source added.

Proceeds from the new debt will be used to help fund the acquisition of Family Dollar Stores Inc. in a cash and stock deal valued at $8.5 billion, under which Family Dollar shareholders will receive $74.50 per share, comprised of $59.60 in cash and $14.90 in Dollar Tree stock, subject to a collar.

Family Dollar stockholders already approved the transaction but the acquisition remains subject to approval by the Federal Trade Commission.

The financing is expected to be completed this month and closing on the acquisition could take place as early as March.

Dollar Tree is a Chesapeake, Va.-based discount store operator. Family Dollar is a Matthews, N.C.-based chain of discount stores.

Citgo flexes higher

Citgo lifted the spread on its $1 billion five-year senior secured first-lien term loan B (Caa1/B-/B+) to Libor plus 825 bps from Libor plus 800 bps and moved the original issue discount to 94 from talk of 96 to 97, according to a market source.

As before, the term loan B has a 1% Libor floor and is non-callable for one year, then at 102 in year two and 101 in year three.

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

Deutsche Bank Securities Inc. is leading the loan that will be used with an expected $1.5 billion pari passu high-yield offering to fund a distribution to Citgo Holding’s ultimate parent.

Citgo is a Houston-based refiner, marketer and transporter of gasoline, diesel fuel, jet fuel, lubricants, petrochemicals and other petroleum-based industrial products.

Acadia reworks pricing

Acadia Healthcare cut pricing on its $500 million seven-year covenant-light term loan B (Ba2/BB-) to Libor plus 350 bps from Libor plus 400 bps and changed the original issue discount to 99½ from 99, a market source remarked.

The 0.75% Libor floor and 101 soft call protection for one year on the B loan were unchanged.

Recommitments were due at 5 p.m. ET on Thursday and allocations are targeted for Friday, the source said.

Bank of America Merrill Lynch, Jefferies Finance LLC, Citigroup Global Markets Inc. and Deutsche Bank Securities Inc. are leading the deal that will be used with $375 million of notes and a common stock issuance to help fund the acquisition of CRC Health Group Inc. for $1,175,000,000, consisting of up to about 6.3 million shares of Acadia’s common stock and the assumption of CRC’s debt.

The notes were upsized from $300 million, reducing the amount of revolver borrowings for the transaction.

Closing is expected this quarter, subject to regulatory review and customary closing conditions.

Acadia is a Franklin, Tenn.-based provider of inpatient behavioral health care services. CRC is a Cupertino, Calif.-based operator of addiction recovery centers.

US Farathane updates terms

US Farathane set pricing on its $390 million seven-year term loan B at Libor plus 575 bps, the high end of the Libor plus 550 bps to 575 bps talk, revised the original issue discount to 98 from 98½ and extended the 101 soft call protection to one year from six months, according to a market source.

As before, the term loan has a 1% Libor floor.

Recommitments were due at 5 p.m. ET on Thursday and allocations are expected on Friday, the source remarked.

Bank of America Merrill Lynch, Barclays, Morgan Stanley Senior Funding Inc. and MCS Capital are leading the deal that will be used to help fund the buyout of the company by the Gores Group and several members of US Farathane’s management, including its chief executive officer, Andy Greenlee.

US Farathane is an Auburn Hills, Mich.-based provider of highly engineered plastic injection-molded components.

Orica changes surface

Orica Chemicals increased its U.S. dollar equivalent term loan (B1) to A$515 million from A$500 million, raised pricing to Libor plus 625 bps from talk of Libor plus 500 bps to 525 bps, widened the original issue discount to 95 from 99 and pushed out the 101 soft call protection to one year from six months, according to a market source.

As before, the term loan has a 1% Libor floor.

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

J.P. Morgan Securities LLC, Barclays, Goldman Sachs Bank USA and Morgan Stanley Senior Funding Inc. are leading the deal that will help fund the A$750 million buyout of the company by Blackstone from Orica Ltd.

The sale includes the chemicals trading businesses in Australia, New Zealand and Latin America and the Australian Chloralkali manufacturing business. It also includes Bronson & Jacobs, which is a supplier to the food & nutrition and health & personal care industries in Australia, New Zealand and Asia.

Closing is expected this quarter, subject to Australian Foreign Investment Review Board and New Zealand Overseas Investment Office approval and other customary conditions.

DBRS discloses talk

Also in the primary, DBRS held its bank meeting on Thursday, launching its $250 million seven-year first-lien covenant-light term loan with talk of Libor plus 525 bps with a 1% Libor floor, an original issue discount of 99 and 101 soft call protection for one year, a market source said.

The company’s $300 million credit facility also includes a $50 million five-year revolver.

Commitments are due on Feb. 19.

Credit Suisse Securities (USA) LLC, UBS AG and TD Securities (USA) LLC are leading the deal that will be used to help fund the buyout of the company by The Carlyle Group and Warburg Pincus.

Closing is expected this quarter.

DBRS is a Toronto-based credit rating agency.

BATS reveals guidance

BATS Global Markets launched with a call at 10 a.m. ET a fungible $128 million add-on term loan talked at Libor plus 475 bps with a 1% Libor floor and an original issue discount of 99, and a new $250 million three-year term loan talked at Libor plus 375 bps with no Libor floor and a discount of 99½, according to a market source.

The loans have 101 soft call protection for one year, the source said.

J.P. Morgan Securities LLC is leading the $378 million of term debt (BB-) that will be used to fund the $365 million acquisition of Hotspot FX from KCG Holdings.

In connection with the new debt, the company is seeking an amendment to its existing credit facility and lenders are being offered a 25 bps consent fee.

Closing is expected in the first half of this year.

BATS is a Kansas City, Mo.-based operator of securities markets. Hotspot is a Jersey City, N.J.-based institutional spot foreign exchange market.

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