Mitel allocates; Traverse upsizes; Odyssey sets talk; funds see Wednesday outflow

By Paul A. Harris

Portland, Ore., Sept. 21 – The loan market remains focused on new issues, sources said Thursday.

Mitel Networks Corp. allocated its $300 million six-year covenant-light term loan B.

Traverse Midstream Partners LLC launched an upsized $1,285,000,000 billion seven-year first-lien term loan.

Odyssey Logistics & Technology Corp. set price talk for $330 million of new bank debt.

And the dedicated bank loan funds saw $15 million of outflows on Wednesday, the most recent session for which data was available at press time, an investor said.

Mitel allocates

Mitel Networks Corp. allocated its $300 million six-year covenant-light term loan B (B1/B+).

Talk had tightened to Libor plus 375 basis points from earlier talk of 400 bps to 425 bps, according to a market source.

The deal retained a 1% Libor floor and an original issue discount of 99.5, according to a market source.

The term loan has 101 soft call protection for six months and amortization of 1% per annum, the source said.

BMO Capital Markets Corp., Citizens Bank, HSBC Bank and CIBC are the bookrunners on the deal.

Proceeds will be used with cash on hand and revolving credit facility borrowings to fund the acquisition of ShoreTel for $7.50 per share, or a total equity value of about $530 million and a total enterprise value of around $430 million.

Closing is expected in the third quarter, subject to customary conditions.

Traverse Midstream upsizes

Traverse Midstream Partners LLC launched an upsized $1,285,000,000 billion seven-year first-lien term loan (B1/B+) ahead of an extended Thursday deadline, according to a market source.

The deal, which is upsized from $1,135,000,000, saw the spread to Libor tighten to 400 basis points from 425 basis points and the discount reduced by 50 bps, now at 99.5 versus talk of 99.

The Libor floor remained unchanged at 1%.

The 101 soft call protection was reduced to six months from one year.

Deutsche Bank Securities Inc. and J.P. Morgan Securities LLC are the bookrunners on the deal.

Proceeds will be used to fund the construction costs for Rover Pipeline and to refinance existing debt.

With respect to the $150 million upsize amount, $75 million will be available for a dividend immediately, with the remaining $75 million to become available upon project completion.

Traverse is an Edmond, Okla.-based midstream company that owns a 35% joint venture interest in Rover Pipeline and a 25% joint venture interest in Ohio River System.

Odyssey Logistics sets talk

Odyssey Logistics & Technology Corp. set price talk for $330 million of new bank debt, according to a market source.

A $245 million seven-year covenant-light first-lien term loan is talked with a 400 basis points to 425 bps spread to Libor atop a 1% Libor floor at 99.5.

An $85 million eight-year covenant-light second-lien term loan is talked at Libor plus 800 bps atop a 1% Libor floor at 99.

Commitments are due at 5 p.m. ET on Oct. 4.

Included in the first-lien term loan is 101 soft call protection for six months, and the second-lien term loan has call protection of 102 in year one and 101 in year two, the source continued.

Credit Suisse Securities (USA) LLC, KeyBanc Capital Markets and UBS Investment Bank are the arrangers on the deal.

The $380 million credit facility also has a $50 million revolver.

Proceeds will be used to help fund the buyout of the company by The Jordan Co.

Closing is expected in the third quarter, subject to customary conditions.

Odyssey Logistics is a Danbury, Conn.-based provider of multi-modal transportation solutions and transportation management.

Air Medical accelerates timing

Air Medical Group Holdings Inc. moved up timing on its $1,455,000,000 seven-year incremental senior secured covenant-light term loan B (B1/B), according to a market source.

Commitments are due at the end of day ET on Monday. Previously books were to remain open through Tuesday.

As reported, the deal is in the market with price talk of Libor plus 425 basis points to 450 bps with a 1% Libor floor and an original issue discount of 99.

The term loan has 101 soft call protection for six months and amortization of 1% per annum, the source said.

With the acceleration of timing there was an announcement of a ticking fee to kick in after 30 days. From day 31 to day 60 the fee will be 50% of the margin. Thereafter it will be the full margin.

Morgan Stanley Senior Funding Inc., Jefferies LLC, Bank of America Merrill Lynch, Citigroup Global Markets Inc., Goldman Sachs Bank USA, Credit Suisse Securities (USA) LLC and Nomura Securities International are the joint lead arrangers on the deal.

Proceeds will be used to help fund the acquisition of American Medical Response from Envision Healthcare Corp. in a transaction valued at $2.4 billion.

Other funds for the acquisition will come from an unsecured debt commitment from PSP Investments Credit USA LLC and Ares Capital Management LLC, and equity.

Closing is expected in the fourth quarter, subject to regulatory approval and customary closing conditions.

Air Medical Group, a KKR portfolio company, is a Dallas-based provider of air and ground ambulance programs. American Medical Response is a Greenwood Village, Colo.-based medical transportation company.

Upon completion of the transaction, the combined company will adopt a new name.

Sterling Talent set for Monday

Sterling Talent Solutions plans to launch a repricing of its $647 million of first lien term loan due June 2024 (existing ratings B2/B) on a conference call set to get underway at 2:30 p.m. ET on Monday, according to a market source.

Goldman Sachs & Co. and KeyBank Capital Markets are the leads. KeyBank is the administrative agent.

The borrower is a Seattle-based provider of comprehensive employment and background screening services.

Time lender call

Time, Inc. is scheduled to participate on a conference call with lenders at 10 a.m. ET on Friday, according to a market source.

Citigroup Global Markets Inc. arranged the call.

Time is a New York-based multimedia company.

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