WireCo changes emerge; Coveris Holdings, SciQuest, Liquid Web on deck with new loans

By Sara Rosenberg

New York, July 19 – WireCo WorldGroup Inc. on Tuesday increased the size of its term loan B as its privately placed second-lien term loan was downsized, reduced the spread on the debt, modified the original issue discount and moved up the commitment deadline.

In more primary happenings, Coveris Holdings SA, SciQuest Inc. and Liquid Web joined this week’s new issue calendar.

WireCo reworked

WireCo raised its senior secured seven-year term loan B (B+) to $460 million from $410 million, trimmed pricing to Libor plus 550 basis points from talk of Libor plus 575 bps to 600 bps and revised the original issue discount to 99 from 98, according to a market source.

Additionally, the incremental incurrence ratio was increased to 4 times from 3.5 times, consistent with the $50 million upsize, and the ticking fee was defined as 275 bps from days 31 to 60 and 550 bps thereafter, the source said.

As before, the term loan B has a 1% Libor floor and 101 soft call protection for six months.

Due to the term loan B upsizing, the company’s privately placed second-lien term loan was downsized by $50 million to $135 million, the source continued.

Commitments for the term loan B are due at 5 p.m. ET on Wednesday, accelerated from noon ET on Friday.

WireCo getting revolver

Along with the term loan B and privately-placed second-lien term loan, WireCo’s credit facility includes a $100 million ABL revolver.

Goldman Sachs & Co. and Scotiabank are leading the deal that is being done in connection with Onex Corp.’s purchase of a majority interest in the company.

Proceeds from the credit facility will be used to refinance the company’s capital structure and extend its debt maturities.

Closing is expected later this year, subject to regulatory approval and customary conditions.

As part of the transaction, funds managed by Paine & Partners LLC, which acquired WireCo in 2007, will maintain a significant minority stake in the company.

WireCo is a Prairie Village, Kan.-based manufacturer of wire rope, synthetic rope, electromechanical cable and highly engineered cable structures.

Coveris readies deal

Coveris set a conference call for 10 a.m. ET on Wednesday to launch a fungible $350 million-equivalent U.S. dollar and euro add-on term loan (B2) due May 8, 2019 that is talked at Libor/Euribor plus 375 bps with a 1% floor and an original issue discount of 99 to 99.5, a market source remarked.

Also, the company is seeking an amendment to its existing senior secured term loan to allow for the add-on loan and the repayment of the notes, and to provide more capacity for, among other things, additional debt, restricted payments, dispositions, investments and acquisitions.

Lenders are being offered a 25 bps amendment fee, the source continued.

Commitments and consents are due on July 27, with closing expected in August.

Coveris refinancing

Proceeds from Coveris’ add-on term loan will be used to redeem 10% senior notes due 2018 at Coveris Holding Corp., to repay some North American and United Kingdom asset-backed revolver borrowings, and to pay transaction fees and expenses.

Goldman Sachs Bank USA, Credit Suisse International and J.P. Morgan Ltd. are leading the deal.

The company currently has a $342.2 million term loan due May 8, 2019 and a €244.7 million term loan due May 8, 2019 priced at Libor/Euribor plus 350 bps with a 1% floor, but that pricing will change to match the add-on term loan pricing being that the debt is fungible.

Net secured leverage is 2.9 times and net total leverage is 4.5 times based on LTM first quarter 2016 pro forma adjusted EBIDTA, including synergies, of $358.8 million, the source added.

Coveris, a Sun Capital Partners Inc. portfolio company, is a Chicago-based manufacturer and distributor of packaging solutions and coated film technologies.

SciQuest on deck

SciQuest emerged with plans to hold a bank meeting for Thursday to launch a new credit facility, according to a market source, who said that size and structure are not yet available.

Antares Capital is leading the deal that will be used to help fund the buyout of the company by Accel-KKR for $17.75 per share in cash, representing a total equity value of about $509 million.

Closing is expected in the third quarter, subject to stockholder approval, regulatory approvals and other customary conditions.

SciQuest is a Morrisville, N.C.-based provider of spend management solutions.

Liquid Web plans call

Liquid Web set a lender call for 9 a.m. ET on Wednesday to launch $62 million of new loans, split between a $5 million incremental revolver and a fungible $57 million incremental term loan due July 2021, a market source remarked.

Pricing on the incremental term loan is Libor plus 450 bps with a 1% Libor floor, which matches existing term loan pricing. Original issue discount talk is still to be determined, the source continued.

SunTrust Robinson Humphrey Inc. and KeyBanc Capital Markets are leading the deal that will be used to fund two tuck-in acquisitions.

Total net leverage is 4.4 times.

Liquid Web is a Lansing, Mich.-based provider of professional web hosting and managed cloud services.

Xerium holds steady

Moving to the secondary market, Xerium Technologies Inc.’s term loan was quoted at 99 7/8 bid, 100¼ offered after the company announced plans to repay all of the debt with proceeds from a $475 million senior secured notes offering, a trader remarked.

The post-news trading levels on the term loan were basically unchanged from pre-news levels as the debt had basically been wrapped around par, the trader added.

In addition to repaying the term loan, the company will use proceeds from its notes offering to redeem all of its 8.875% senior notes due 2018 and to pay related premiums, fees and expenses.

Xerium is a Youngsville, N.C.-based provider of industrial consumable products and services.

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