Staples sets talk; Kloeckner Pentaplast brings dual-currency deal; index unchanged on Tuesday

By Paul A. Harris

Portland, Ore., April 7 – The LCDX 22 index of bank loan credit default swaps ended at 102˝ bid, 103˝ offered, unchanged on Tuesday, according to a hedge fund manager.

In the primary market, Staples Inc. set price talk for its $5.75 billion credit facility.

And Germany-based Kloeckner Pentaplast plans to put in place a €931 million-equivalent dual-currency credit facility.

Staples talk

Staples set price talk for its $5.75 billion credit facility, according to a market source.

A $2.75 billion six-year senior secured term loan B is talked at Libor plus 350 basis points with a 0.75% Libor floor at 99, with 101 soft call for six months.

There is a ticking fee of 50% of the term loan margin beginning May 1, 2015 and of 100% of the term loan margin plus the Libor floor starting June 1, 2015.

There is also a 5% annual amortization.

Commitments are due April 21.

Barclays, Bank of America Merrill Lynch, Wells Fargo Securities LLC and HSBC Securities (USA) Inc. are the bookrunners on the deal.

The facility also features a $3 billion asset-based five-year revolver.

Proceeds will be used to help fund the acquisition of Office Depot Inc. and to refinance some of the debt of both companies.

Staples is a Framingham, Mass.-based retailer of office supplies. Office Depot is a Boca Raton, Fla.-based provider of products, services, and solutions for the workplace.

Kloeckner Pentaplast deal

Germany-based Kloeckner Pentaplast plans to put in place a €931 million-equivalent credit facility, according to a market source.

The deal, which is being led by arranger Credit Suisse, kicks off at a bank meeting on Thursday, with commitments due on April 22.

It includes two tranches of five-year first-lien covenant-light paper.

Featured is a dollar-denominated tranche sized at €631 million-equivalent, coming with talk of Libor plus 450 to 475 bps at 99.

There is also a €200 million tranche with talk of Euribor plus 475 to 500 bps at 99.

Both tranches come with 1% Libor floors and have six months of soft call protection at 101.

The facility also includes a €100 million 4.75-year revolver.

The borrowers are KP Germany Erste GmbH, Kloeckner Pentaplast GmbH and Kloeckner Pentaplast of America, Inc.

The Montabaur, Germany-based packaging producer plans to use the refinance debt and fund a shareholder dividend.

Astoria prices add-on

Astoria Energy, LLC priced an $87.25 million fungible add-on to its Libor plus 400 bps six-year term loan B (Ba3/BB) at par on Tuesday, according to a market source.

The deal, which features a 1% Libor floor and 101 soft call until December 2015, came at the rich end of the 99.875 price talk.

Morgan Stanley & Co. was the bookrunner and lead arranger.

The New York-based power generator plans to use the proceeds to fund a dividend.

The add-on is expected to close on April 14.

The aggregate amount of the loan is $775 million following the add-on.

Genoa sets talk

Genoa, a QUO Healthcare Co., LLC set price talk for its $420 million credit facility, according to a market source.

A $265 million seven-year first-lien covenant-light term loan is talked at Libor plus 425 bps with a 1% Libor floor at 99. It comes with six-month soft call protection at 101.

A $155 million eight-year second-lien covenant-light term loan is talked at Libor plus 850 bps with a 1% Libor floor at 99, with hard calls at 102 in year one and 101 in year two.

The commitment date was moved ahead to April 17 from April 21.

Credit Suisse Securities (USA) LLC is leading the $470 million facility, which also includes a $50 million revolver.

Credit ratings remain to be determined.

Proceeds will be used to fund the LBO of the Gresham, Ore.-based behavioral health specialty pharmacy company by Advent International and Nautic Partners.

NEP sets pricing

NEP/NCP Holdco Inc. set pricing for its $75 million incremental second-lien term loan due July 22, 2020 (Caa1/B-), according to a market source.

The deal is talked at Libor plus 875 bps, the same as the existing loan. It features a 1.25% Libor floor. Discount talk is 98.

Call protection sets hard calls at 102 in year one and 101 in year two.

There is a 101 IPO carveout on both the existing and incremental term loans.

Barclays is the bookrunner.

Proceeds will be used to fund the acquisition of Mediatec Group, fund a separate bolt-on acquisition and repay some revolving credit facility borrowings.

Other funds for the Mediatec transaction will come from the assumption of Mediatec’s existing debt and additional cash contributed by funds managed by Crestview Partners in exchange for common equity, as well as equity contributions by NEP management.

NEP is a Pittsburgh-based provider of outsourced teleproduction services critical to the delivery of live sports and entertainment events. Mediatec is a Sweden-based provider of integrated technical solutions for event and television productions.

Sage Automotive prices

Sage Automotive Holdings Inc. priced a $30 million Libor plus 500 bps add-on first-lien term loan (B2/B) at 99, according to a market source.

The spread and reoffer price came on top of talk.

The spread and 1% Libor floor match the existing first-lien term loan.

UBS AG was the lead on the deal that launched earlier this month.

Proceeds will be used to fund the purchase of equity interests in Miko.

Sage Automotive is a Greensville, S.C.-based supplier of high-performance specialty fabric materials for automobiles.

SESAC lender call

SESAC plans to participate in a lender call on Thursday, organized by Jefferies LLC.

The Nashville-based performing rights organization is shopping a $90 million second-lien term loan and a $25 million add-on to its existing first-lien term loan.

Proceeds will be used to support a dividend recapitalization.

Last year the company repaid its previous second-lien term loan with proceeds of a $155 million add-on to its previous $235 million first-lien term loan due February 2019, which is priced at Libor plus 400 bps with a 1% Libor floor.

SESAC represents the interests of individual songwriters and publishers of music to ensure they are compensated for the public performance of their copyrighted material.

American Airlines lender call

American Airlines Group Inc. will take part in a lender call set to get underway at 1 p.m. ET on Wednesday, for a loan to be led by Citigroup Global Markets and other joint lead arrangers.

The commercial airline, a subsidiary of AMR Corp., is based in Fort Worth.

Scientific Applications lender call

Science Applications International Corp. plans to participate in a lender meeting at 10 a.m. ET Thursday, ahead of an expected bank loan deal.

The meeting is organized by Citigroup Global Markets.

The McLean, Va.-based technology integrator provides full life-cycle services and solutions in the technical, engineering and enterprise information technology markets.

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