Leslie’s, WCA Waste break; Walter rises; Valeant better with amendment and asset sale talk

By Sara Rosenberg

New York, Aug. 9 – Leslie’s Poolmart Inc. increased the size of its term loan and tightened the spread as well as the original issue discount, and then the term loan freed up for trading on Tuesday, and WCA Waste Corp.’s credit facility broke as well.

Also in trading, Walter Investment Management Corp.’s term loan was stronger as the company announced sale agreements, Valeant Pharmaceuticals International Inc.’s term loans strengthened with chatter of an amendment and potential asset sales, and Builders FirstSource Inc.’s term loan B was a little softer following paydown news.

Back in the primary market, NEW Asurion Corp. modified the spread and original issue discount on its term loan, Headwaters Inc. revised the issue price on its add-on term loan B, United Site Services Inc. and SciQuest Inc. both tightened discounts on their term loans, and Trader Corp. lowered pricing on its first-lien term loan B.

Additionally, Cavium Inc. reduced the spread and widened the issue price on its term loan, Oasis Outsourcing Holdings Inc. tweaked its amendment proposal, and Harbor Freight Tools USA Inc. accelerated the commitment deadline on its term loan.

Furthermore, ESH Hospitality Inc. and Amplify Snack Brands Inc. disclosed price talk with launch, Medical Depot Inc. released original issue discount guidance on its incremental term loan, Global Healthcare Exchange LLC approached lenders with an add-on first-lien term loan, and Xplornet Communications Inc. emerged with new deal plans.

Leslie’s reworked, trades

Leslie’s Poolmart raised its seven-year covenant-light term loan B to $810 million from $780 million, lowered pricing to Libor plus 425 basis points from Libor plus 450 bps, moved the original issue discount to 99.5 from 99 and eliminated the 18-month MFN sunset, according to a market source.

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

Recommitments were due at noon ET on Tuesday, and by late day the debt had allocated and begun trading, with levels quoted at par ¼ bid, par ¾ offered, the source continued.

Nomura is leading the deal that will be used with $390 million of privately placed notes, which were downsized from $420 million with the term loan B upsizing, and cash on hand to refinance existing debt and fund a dividend.

Leslie’s Poolmart is a Phoenix-based retailer of swimming pool supplies and related products.

WCA frees up

WCA Waste’s credit facility hit the secondary market, with the $300 million term loan B quoted at par bid, par ½ offered, a trader said.

The term loan is priced at Libor plus 300 bps with a 1% Libor floor and was sold at an original issue discount of 99.75, after tightening during syndication from 99.5. The debt includes 101 soft call protection for six months.

Along with the term loan, the company’s $425 million credit facility (B2/B+) provides for a $125 million revolver.

SunTrust Robinson Humphrey Inc. is leading the deal that will be used to refinance existing bank debt.

WCA is a Houston-based vertically integrated non-hazardous solid waste management company.

Walter Investment gains

Walter Investment’s term loan rose to 88½ bid, 91½ offered from 82½ bid, 84 offered after the company announced a series of agreements with New Residential Investment Corp., according to a trader.

The company disclosed that it entered into an agreement with New Residential Investment for the purchase and sale of about $35 billion unpaid principal balance of seasoned conventional mortgage servicing rights for around $231 million and for the purchase and sale of substantially all of the assets of Walter Capital Opportunity LP and its subsidiaries for roughly $283 million.

The transactions are expected to close in the third or fourth quarter.

Also on Tuesday, Walter released second-quarter numbers showing a GAAP net loss of $232.4 million, or $6.49 per share, versus a GAAP net loss of $38.1 million, or $1.01 per share, for the quarter ended June 30, 2015.

Total revenue for the second quarter of 2016 was $187.5 million, down from $412.4 million, and adjusted EBITDA was $98.8 million, down from $140.4 million in the prior year.

Walter Investment is a Tampa, Fla.-based diversified mortgage banking firm.

Valeant heads higher

Valeant Pharmaceuticals’ term loans were better in the secondary market after the company said that it plans to approach lenders soon with an amendment to relax its interest coverage covenant and that it is looking at about $8 billion transaction value in non-core asset sales, traders said.

The term loan F was quoted at 99 7/8 bid, par ¼ offered, up from 99 bid, 99½ offered. The term loans C and D were quoted at 99 5/8 bid, 99 7/8 offered, up from 98 3/8 bid, 98 7/8 offered. The term loan E was quoted at 99½ bid, 99 7/8 offered, up from 98¼ bid, 98¾ offered, traders added.

The company also reported second-quarter numbers, including a net loss of $302 million, or $0.88 per share, compared to a net loss of $53 million, or $0.15 per share, in the second quarter of 2015.

Total revenues in the quarter were $2.42 billion, down from $2.73 billion in the prior-year period.

Valeant is a Laval, Quebec-based specialty pharmaceutical company.

Builders FirstSource dips

Builders FirstSource’s term loan B slid to par 1/8 bid, par ½ offered from par ¼ bid, par ¾ offered after it emerged that the company will repay some of the debt with a portion of the proceeds from a $750 million senior secured notes offering, according to a trader.

The new notes will also be used to refinance senior secured notes due 2021.

Builders FirstSource is a Dallas-based building materials manufacturer and supplier.

BWIC surfaces

A roughly $124 million loan Bid Wanted in Competition was announced, with bids due at 11 a.m. ET on Wednesday, a trader remarked.

Some of the names in the portfolio are Aramark Corp., Berry Plastics Corp., Catalent Pharma Solutions Inc., Energy Transfer Equity LP, Huntsman International LLC, Ineos US Finance LLC, Penn National Gaming Inc., Toys ‘R’ Us Delaware Inc. and Valeant.

There are about 48 issuers in the portfolio, the trader added.

NEW Asurion adjusts terms

Switching back to the primary market, NEW Asurion cut pricing on its $550 million five-year HoldCo unsecured PIK contingent covenant-light term loan (Caa1) to Libor plus 900 bps plus 75 bps for any PIK amount from Libor plus 950 bps plus 75 bps for any PIK amount, and it tightened the original issue discount to 99 from talk of 98 to 98.5, a market source said.

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

Commitments were due at 5 p.m. ET on Tuesday, the source added.

Morgan Stanley Senior Funding Inc., Bank of America Merrill Lynch, Barclays, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and Goldman Sachs Bank USA are leading the deal that will be used to fund an equity tender offer and to pay transaction-related fees and expenses.

NEW Asurion is a Nashville-based provider of consumer product protection programs.

Headwaters changes emerge

Headwaters tightened the original issue discount on its $350 million covenant-light add-on term loan B (B1/BB-) due March 2022 to 99.75 from 99.5 and accelerated the commitment deadline to 5 p.m. ET on Wednesday from noon ET on Aug. 11, according to a market source.

Pricing on the add-on term loan is still Libor plus 300 bps with a 1% Libor floor, in line with existing term loan pricing, and the debt still has 101 soft call protection for six months.

Deutsche Bank and Bank of America Merrill Lynch are leading the deal that will be used to fund the acquisition of Krestmark Industries LP for $240 million and to refinance 7¼% senior notes due 2019.

Headwaters is a South Jordan, Utah-based building products manufacturer. Krestmark is a Dallas-based manufacturer of vinyl windows.

United Site tightens OID

United Site Services modified the original issue discount on its $340 million covenant-light term loan to 99.5 from 99 and left pricing at Libor plus 450 bps with a 1% Libor floor, a market source said.

The loan still has 101 soft call protection for six months.

The company’s $450 million credit facility (B2/B) also includes a $60 million revolver and a $50 million delayed-draw term loan.

Antares Capital, Societe Generale and Citizens Banks are leading the deal that will be used to refinance existing debt.

United Site Services is a Westborough, Mass.-based provider of portable sanitation solutions.

SciQuest tweaks discount

SciQuest changed the original issue discount on its $163 million term loan to 99.5 from 99, according to a market source, who said that the pricing of Libor plus 475 bps with a 1% Libor floor and the 101 soft call protection for six months were unchanged.

The company’s $178 million credit facility also includes a $15 million revolver.

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.

Trader flexes lower

Trader Corp. trimmed pricing on its C$510 million seven-year first-lien term loan B that will be issued in U.S. dollars (B2/B) to Libor plus 400 bps from talk of Libor plus 425 bps to 450 bps and eliminated the MFN sunset, according to a market source.

The first-lien term loan still has a 1% Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months.

Commitments were due at 5 p.m. ET on Tuesday, the source said.

The company’s C$760 million credit facility, which will be used to help fund the roughly C$1.58 billion buyout of the company by Thoma Bravo LLC, also includes a C$50 million revolver (B2/B) and a C$200 million privately placed second-lien term loan (Caa2/CCC+).

Goldman Sachs & Co., J.P. Morgan Securities LLC, UBS Investment Bank and Macquarie Capital are leading the deal, with Goldman left on the first-lien debt and JPMorgan left on the second-lien loan.

Closing is expected by the fourth quarter, subject to customary conditions.

Trader Corp. is an Etobicoke, Ont.-based digital automotive marketplace.

Cavium sets revisions

Cavium reduced pricing on its $700 million six-year term loan B (Ba3/BB-) to Libor plus 300 bps from Libor plus 350 bps while changing the original issue discount to 99 from 99.5, a market source remarked.

The loan still has a 0.75% Libor floor and 101 soft call protection for six months.

Recommitments were due at 5 p.m. ET on Tuesday, the source added.

JPMorgan is leading the deal that will be used with cash on hand to help fund the acquisition of QLogic Corp. for about $15.50 per share, comprised of $11.00 per share in cash and 0.098 of a share of Cavium common stock for each share of QLogic common stock. The transaction values QLogic at around $1.36 billion in equity value, inclusive of roughly $355 million of cash on QLogic’s balance sheet.

Closing is expected in the third quarter, subject to the tender of a majority of QLogic shares, regulatory approvals and other customary conditions.

Cavium is a San Jose, Calif.-based provider of highly integrated semiconductor products. QLogic is an Aliso Viejo, Calif.-based maker of server and storage networking connectivity products.

Oasis modifies amendment

Oasis Outsourcing changed its amendment request so that the incremental amount is the greater of $60 million and consolidated EBITDA as of the most recently ended test period, instead of $40 million, a market source remarked.

Amendment signatures are now due at 5 p.m. ET on Wednesday, revised from 5 p.m. ET on Tuesday, the source said.

As before, the amendment, among other things, would reset the 101 soft call protection on the first-lien loan for six months and permit the repayment of the company’s second-lien term loan.

Lenders are still being offered a 12.5 bps amendment fee.

Oasis incremental loan

Along with the amendment, Oasis Outsourcing is getting a fungible $75 million incremental first-lien term loan due Dec. 31, 2021 priced at Libor plus 475 bps with a 1% Libor floor and an original issue discount of 99.75.

The discount on the incremental loan was revised on Monday from 99.5.

RBC Capital Markets and SunTrust Robinson Humphrey Inc. are leading the debt that will be used to fund the acquisition of a Tennessee-based professional employer organization with about 600 clients representing around 14,500 worksite employees for about $33 million and to opportunistically pay down the outstanding $60 million second-lien term loan.

Commitments for new money were due at noon ET Tuesday.

Oasis Outsourcing, a Stone Point Capital-owned company, is a West Palm Beach, Fla.-based provider of HR outsourcing services to small- and medium-sized businesses.

Harbor Freight shutting early

Harbor Freight Tools moved up the commitment deadline on its $2.2 billion seven-year covenant-light first-lien term loan (Ba3/BB-) to 5 p.m. ET on Thursday from Aug. 16, according to a market source.

Price talk on the term loan is Libor plus 350 bps to 375 bps with a 1% Libor floor and an original issue discount of 99.5, and the debt has 101 soft call protection for six months.

The company’s $2.9 billion credit facility also includes a $700 million ABL revolver.

Credit Suisse is leading the deal that will be used to refinance existing debt and fund a shareholder distribution.

Harbor Freight is a Camarillo, Calif.-based provider of tools and equipment.

ESH releases talk

In more primary news, ESH Hospitality held its bank meeting on Tuesday morning, and with the event, price talk on its $1.3 billion seven-year covenant-light term loan B was announced, according to a market source.

The term loan B is talked at Libor plus 300 bps to 325 bps with a 0.75% Libor floor, an original issue discount of 99 and 101 soft call protection for six months, the source said.

Commitments are due on Aug. 17.

The company’s $1.65 billion credit facility (B1/BB+) also includes a $350 million revolver.

Deutsche Bank, JPMorgan, Citigroup Global Markets Inc., Goldman Sachs Bank USA, Bank of America Merrill Lynch, Morgan Stanley Senior Funding Inc., Barclays, Credit Suisse and Macquarie Capital (USA) Inc. are leading the deal that will be used with cash on hand to refinance the remainder of the company’s roughly $1.5 billion CMBS loan.

ESH Hospitality is a subsidiary of Extended Stay America Inc., a Charlotte, N.C.-based owner/operator of company-branded hotels.

Amplify floats terms

Amplify Snack Brands disclosed price talk of Libor plus 525 bps with a 1% Libor floor and an original issue discount of 99 on its $600 million seven-year covenant-light term loan that launched with an afternoon bank meeting, according to a market source.

The term loan has 101 soft call protection for six months.

The company’s $650 million senior secured credit facility also includes a $50 million five-year revolver.

Commitments are due on Aug. 19, the source said.

Jefferies Finance LLC, Credit Suisse and Goldman Sachs Bank USA are leading the deal that will be used to help fund the acquisition of Crisps Topco Ltd. (Tyrrells) from Investcorp for £278 million in cash and about 2.1 million shares of Amplify’s common stock and to refinance existing debt at Amplify.

Closing on the credit facility is targeted for Aug. 26.

Pro forma for the transaction, net leverage is 5.7x based on last-12-months June 30 pro forma combined adjusted EBITDA of $104.4 million.

Austin, Texas-based Amplify and Herefordshire, England-based Crisps Topco are snack food companies.

Medical Depot OID guidance

Medical Depot came out with original issue discount talk of 99.5 on its $40 million incremental term loan due September 2019 that launched with a call during the session, according to a market source.

As previously reported, pricing on the incremental term loan is Libor plus 425 bps with a 1% Libor floor, in line with pricing on the existing $220 million term loan.

Capital One is leading the deal that will be used to fund a tack-on acquisition and for general corporate needs.

Medical Depot (doing business as Drive DeVilbiss Healthcare) is a Port Washington, N.Y.-based maker of medical equipment.

Global Healthcare launches

Global Healthcare Exchange launched in the morning a fungible $10 million add-on first-lien term loan (B) talked at Libor plus 425 bps with a 1% Libor floor, which matches pricing on its existing $415 million first-lien term loan B, and an original issue discount of 99.75, a market source said.

Proceeds from the add-on first-lien loan and a privately placed $135 million second-lien term loan (CCC+) will be used to fund a shareholder distribution to private equity owner Thoma Bravo.

The company also launched an amendment to its existing credit agreement to allow for the distribution and reset the total net leverage covenant, for which lenders are being offered a 12.5 bps consent fee.

SunTrust Robinson Humphrey is leading the deal.

Consents and commitments are due on Aug. 16, the source added.

Global Healthcare Exchange is a Louisville, Colo.-based provider of SaaS/cloud-based supply-chain-automation technology and services to the health-care sector.

Xplornet on deck

Xplornet Communications set a lender meeting for 10 a.m. ET on Thursday to launch a $335 million credit facility, split between a $285 million five-year term loan (B1) and a $50 million revolver (Ba3), according to a market source.

Talk on the term loan is Libor plus 600 bps with a 1% Libor floor, an original issue discount of 98.5 and 101 soft call protection for one year, the source said.

SunTrust Robinson Humphrey, BMO Capital Markets Corp. and Jefferies Finance LLC are leading the deal that will be used to refinance existing senior secured notes.

Xplornet is a Woodstock, N.B.-based rural-focused broadband service provider.

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