CPI Card, Duff & Phelps, Patterson Medical, Albany Molecular break; Avago tweaks deals

By Sara Rosenberg

New York, Aug. 14 – CPI Card Group widened the spread and original issue discount on its term loan B, and Duff & Phelps Corp. downsized its second-lien term loan and raised pricing, and then both deals freed up for trading on Friday.

Also making its way into the secondary market during the session was Patterson Medical’s first- and second-lien term loans and Albany Molecular Research Inc.’s new credit facility.

Back in the primary market, Avago Technologies Ltd. lifted the size of its term loan A, and 888 Holdings Ltd. plc pulled its credit facility from the primary market.

CPI Card flexes, trades

CPI Card Group lifted pricing on its $435 million term loan B to Libor plus 450 basis points from Libor plus 400 bps and revised the original issue discount to 98.5 from talk of 99 to 99.5, according to a market source.

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

The company’s $475 million credit facility (B1) also includes a $40 million revolver.

Recommitments were due at 11 a.m. ET, and with final terms in place the debt began trading on Friday with the term loan B quoted at 98½ bid, 99½ offered, a trader remarked.

Goldman Sachs Bank USA, BNP Paribas Securities Corp. and Scotiabank are leading the deal that will be used to refinance existing debt and fund a redemption of preferred stock.

CPI Card Group is a Littleton, Colo.-based provider of payment solutions, including card production, card personalization, mobile technologies and fulfillment services.

Duff & Phelps reworked

Duff & Phelps reduced its six-year second-lien term loan to $100 million from $110 million and widened pricing to Libor plus 850 bps from Libor plus 775 bps, while leaving the 1% Libor floor, original issue discount of 99 and call protection of 102 in year one and 101 in year two unchanged, a market source said.

In addition, the company’s incremental first-lien term loan due April 23, 2020 was upsized to $52 million from $41 million, the source continued, with pricing remaining at Libor plus 375 bps with a 1% Libor floor and an original issue discount of 99.75.

Earlier in syndication, the spread on the incremental first-lien term loan was increased from Libor plus 350 bps with Moody’s Investors Service’s decision to change the company’s rating outlook to negative, and, as a result, the spread on the company’s existing $634 million first-lien term loan is moving to Libor plus 375 bps from Libor plus 350 bps.

As before, all of the first-lien term loan debt is getting 101 soft call protection for six months.

Duff & Phelps breaks

After terms firmed up, Duff & Phelps’ new debt also emerged in the secondary market, with the incremental first-lien term loan seen at par bid, 100½ offered and the second-lien term loan seen at 99 bid, par offered, a trader added.

Credit Suisse Securities (USA) LLC and RBC Capital Markets are leading the $152 million in new term loans that will be used to fund a dividend to shareholders.

In connection with the new loans and dividend, existing lenders are being offered a 25 bps amendment fee.

Duff & Phelps is a New York-based financial advisory and investment banking firm.

Patterson starts trading

Patterson Medical’s $300 million seven-year first-lien covenant-light term loan B (Ba3/B) broke for trading too, with levels quoted at 99 5/8 bid, 100 3/8 offered, according to a trader.

Pricing on the first-lien term loan is Libor plus 425 bps with a 1% Libor floor, and it was sold at an original issue discount of 99. There is 101 soft call protection for one year.

The other day, pricing on the first-lien term loan was lifted from Libor plus 375 bps, the issue price firmed at the wide end of the 99 to 99.5 talk, and the call protection was extended from six months.

Deutsche Bank Securities Inc., Bank of America Merrill Lynch, Barclays and Jefferies Finance LLC are leading the deal.

Patterson second-lien

Along with the first-lien term loan, Patterson Medical is getting a $135 million eight-year second-lien covenant-light term loan (Caa1/CCC+) that was privately placed at pricing of Libor plus 775 bps with a 1% Libor floor. This tranche has hard call protection of 102 in year one and 101 in year two.

The second-lien term loan was quoted at 99¾ bid, 100¾ offered in trading, a trader added.

Proceeds from the term loans will be used with equity to fund the buyout of the company by Madison Dearborn Partners from Patterson Cos. Inc. for gross proceeds of around $715 million in cash.

Closing is expected in the fiscal second quarter, subject to regulatory requirements and other customary conditions.

Patterson Medical is a distributor of rehabilitation supplies and non-wheelchair assistive patient products to the physical and occupational therapy markets.

Albany Molecular frees up

Albany Molecular Research’s credit facility hit the secondary as well, with the $200 million six-year term loan B quoted at 99¼ bid, 100¼ offered, a trader said.

Pricing on the term loan is Libor plus 475 bps with a 1% Libor floor, and it was sold at an original issue discount of 99. The debt has 101 soft call protection for one year.

Recently, the call protection on the term loan was extended from six months, and the free and clear incremental basket was reduced to $50 million from $60 million. Any incremental term loan will be prohibited to make a junior debt payment.

The company’s $230 million credit facility (B1/B+) also includes a $30 million five-year revolver.

Barclays is leading the deal that will be used to support the company’s acquisition of Gadea Grupo Farmaceutico and to repay revolver borrowings.

Net senior secured leverage is 1.5 times, and net total leverage is 3.9 times.

Albany Molecular is an Albany, N.Y.-based drug discovery services and manufacturing company.

Ellucian holds steady

Also in trading, Ellucian’s term loan was unchanged at 99 7/8 bid, 100¼ offered following news that the company is being acquired by TPG Capital and Leonard Green Partners from Hellman & Friedman and co-investor JMI Equity, a trader remarked.

Closing on the buyout is expected before year-end, subject to customary conditions, including receipt of regulatory approvals.

Morgan Stanley & Co. LLC, BofA Merrill Lynch, BMO Capital Markets Corp. and Barclays served as financial advisors to TPG and Leonard Green, and Credit Suisse and Goldman Sachs & Co. served as financial advisors to Ellucian.

Ellucian is a Fairfax, Va.-based provider of software and services to the education community.

Avago upsizes

Returning to the primary market, Avago Technologies increased its term loan A to $4.25 billion from $3.25 billion, while leaving pricing at Libor plus 150 bps to 200 bps, subject to a ratings-based grid, according to a market source.

The company’s now $4.75 billion five-year credit facility also includes a $500 million revolver.

Recommitments are due at 5 p.m. ET on Monday, the source said.

Credit Suisse Securities (USA) LLC, Bank of America Merrill Lynch, Deutsche Bank Securities Inc., Barclays, Citigroup Global Markets Inc. and Wells Fargo Securities LLC are leading the deal that will be used to refinance existing debt and help fund the acquisition of Broadcom Corp. for $17 billion in cash consideration and the economic equivalent of about 140 million Avago ordinary shares.

Closing is expected in the first quarter of 2016, subject to regulatory approvals and the approval of Avago’s and Broadcom’s shareholders. The combined company will adopt the name Broadcom Ltd.

Avago is a designer, developer and supplier of analog semiconductor devices with headquarters in Singapore and San Jose, Calif. Broadcom is an Irvine, Calif.-based semiconductor company.

888 withdrawn

888 Holdings removed its $650 million-equivalent credit facility (Ba3/B+) from the primary market, a market source said.

The facility consisted of a $50 million five-year multi-currency revolver and a $600 million-equivalent U.S. dollar and euro covenant-light six-year term loan talked at Libor/Euribor plus 400 bps with a 1% floor, an original issue discount of 99 to 99.5 and 101 soft call protection for six months.

The term loan would have had a ticking fee of half the margin for days 16 through 45 and the full margin plus the floor thereafter.

It was expected that the U.S. piece of the term loan would be greater than or equal to $350 million.

Earlier this month, pricing on the term loan was lifted from talk of Libor/Euribor plus 325 bps to 350 bps and discount guidance was revised from just 99.5.

Barclays and J.P. Morgan Securities LLC were leading the deal that was going to help fund the acquisition of bwin.party digital entertainment plc for about £898.3 million.

888 and bwin.party are Gibraltar-based online gaming companies.

Ryan closes

In other news, Ryan LLC completed its $300 million credit facility (B2/B) that consists of a $50 million revolver and a $250 million five-year term loan, according to a news release.

Pricing on the term loan is Libor plus 575 bps with a 1% Libor floor, and it was sold at an original issue discount of 98.5. The debt has 101 soft call protection for one year.

During syndication, the spread on the term loan firmed at the wide end of the Libor plus 550 bps to 575 bps talk.

Goldman Sachs Bank USA and Bank of America Merrill Lynch are leading the deal that was used to refinance existing debt and add cash to the balance sheet.

Ryan is a Dallas-based provider of tax services.

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