Nouryon, Filtration Group, Wyndham, Golden Entertainment free up; Catalent levels soften

By Sara Rosenberg

New York, May 19 – Nouryon came out with updated sizes on its U.S. and euro term loans and firmed the spread on the euro tranche at the low end of guidance, and Filtration Group Corp. reduced the size of its U.S. first-lien term loan and increased pricing, and upsized its euro first-lien term loan and set the spread at the low end of talk, and then both of these deals broke for trading on Friday.

Other deals to make their way into the secondary market during the session included Wyndham Hotels & Resorts Inc. and Golden Entertainment Inc.

In more trading news, Catalent Inc.’s term loan was a little weaker as the company released some updated earnings guidance and said that it needs more time to complete its third quarter results.

Meanwhile, back in the primary market, KinderCare Learning Cos. Inc. downsized its first-lien term loan and adjusted the original issue discount.

Nouryon sets terms

Nouryon set its U.S. first-lien term loan B due April 3, 2028 size at $2.5 billion, compared to revised talk of minimum $2.3 billion and initial talk of minimum $2.5 billion, and its euro first-lien term loan B due April 3, 2028 size at €1.595 billion, compared to revised talk of minimum €1.4 billion and initial talk of minimum €1.2 billion, according to a market source.

However, both term loans (B2/B+/BB-) may be increased prior to settlement, pending extension by an overseas international bank, the source said. The euro term loan could increase to €1.69 billion.

Furthermore, pricing on the euro term loan firmed at Euribor plus 425 bps, the low end of the Euribor plus 425 bps to 450 bps talk, while the 0% floor and original issue discount of 98 were unchanged.

As before, the U.S. term loan is priced at SOFR+10 bps CSA plus 400 bps with a 0% floor and an original issue discount of 98, and has 101 soft call protection until Oct. 3, 2023.

Previously in syndication, the discount on the U.S. term loan was adjusted from talk in the range of 98.5 to 99, a springing maturity was added to Oct. 1, 2025 if greater than $500 million of the initial term loans remain outstanding, and changes were made to MFN.

Nouryon hits secondary

On Friday, Nouryon’s loans freed to trade, with the U.S. term loan quoted at 98 1/8 bid, 98 5/8 offered and the euro term loan quoted at 98¼ bid, 98¾ offered, traders added.

JPMorgan Chase Bank is the left lead bookrunner on the U.S. term loan. Barclays, HSBC and JPMorgan are joint global coordinators and joint physical bookrunners on the euro term loan. JPMorgan is the administrative agent.

The new debt will be used to amend and extend a portion of the company’s existing $3.2 billion term loan B due October 2025 and a portion of the existing €1.69 billion term loan B due October 2025, and to pay transaction fees and expenses.

The U.S. term loan is not fungible with the company’s existing $750 million term loan due April 2028.

Carlyle and GIC are the sponsors.

Nouryon is an Amsterdam-based specialty chemicals company.

Filtration tweaked, frees

Filtration Group scaled back its U.S. first-lien term loan due October 2028 to $1.129 billion from $1.227 billion and lifted pricing to SOFR plus 425 bps from talk in the range of SOFR plus 375 bps to 400 bps, a market source remarked.

Furthermore, the company lifted its euro first-lien term loan due October 2028 to €500 million from €409 million and set pricing at Euribor plus 425 bps, the low end of the Euribor plus 425 bps to 450 bps talk.

The U.S. term loan still has CSA of 11 bps one-month rate, 26 bps three-month rate and 43 bps six-month rate and an original issue discount of 99, the euro term loan still has a discount of 98, and both term loans (B3/B) still have a 0.5% floor and 101 soft call protection for six months.

Recommitments were due at 12:30 p.m. ET on Friday and the U.S. term loan began trading in the afternoon, with levels quoted at 99 1/8 bid, 99 5/8 offered, another source added.

The euro term loan is expected to free to trade on Monday.

Goldman Sachs Bank USA and JPMorgan Chase Bank are leading the deal that will be used to amend and extend an existing U.S. first-lien term loan due 2025 and an existing euro first-lien term loan due 2025.

Filtration Group is a provider of filtration solutions serving a diverse portfolio of global end markets.

Wyndham starts trading

Wyndham Hotels & Resorts’ $1.144 billion seven-year covenant-lite term loan B (Ba1/BBB-/BBB-) broke as well, with levels quoted at 99¾ bid, par bid, according to a market source.

Pricing on the term loan is SOFR+10 bps CSA plus 225 bps with a 0% floor and it was sold at an original issue discount of 99.5. The debt has 101 soft call protection for six months.

During syndication, the term loan was upsized from $750 million as plans for $400 million of other senior secured debt were eliminated, the spread finalized at the low end of the SOFR plus 225 bps to 250 bps talk, and the discount firmed at the tight end of the 99 to 99.5 talk.

Deutsche Bank Securities Inc., JPMorgan Chase Bank, BofA Securities Inc., Barclays, US Bank, Wells Fargo Securities LLC, Bank of Nova Scotia, Truist, PJT Partners, Capital One, Fifth Third, HSBC Securities (USA) Inc., Santander and City National Bank are leading the deal that will be used to refinance an existing term loan B. BofA Securities is the administrative agent.

Closing is expected during the week of May 22.

Wyndham is a Parsippany, N.J.-based hotel franchising company.

Golden Entertainment breaks

Golden Entertainment’s $400 million seven-year first-lien term loan B (Ba3/BB) freed to trade too, with levels quoted at 99 3/8 bid, 99 7/8 offered, a market source said.

Pricing on the term loan is SOFR+10 bps CSA plus 275 bps with a 0.5% floor and it was sold at an original issue discount of 99.25. The debt has 101 soft call protection for six months.

During syndication, pricing on the term loan was set at the low end of the SOFR plus 275 bps to 300 bps talk and the discount was tightened from 99.

JPMorgan Chase Bank, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and Citizens Bank are leading the deal that will be used to help repay a roughly $575 million term loan due 2024 and pay transaction fees and expenses.

Other funds for the transaction will come from proceeds from the sale of the company’s Rocky Gap Casino Resort. Century Casinos Inc. will acquire the operations of Rocky Gap for $56.1 million and VICI Properties Inc. will acquire an interest in the land and buildings associated with Rocky Gap for $203.9 million.

Closing on the sale is expected mid-year, subject to regulatory approvals and customary conditions.

Golden Entertainment is a Las Vegas-based owner and operator of a diversified entertainment platform.

Catalent dips

Catalent’s term loan weakened in trading to 96¾ bid, 97¾ offered on Friday from 97 bid, 98 offered on Thursday as the company released revised full-year guidance and changed its scheduled Friday conference call to a business update from a review of third quarter 2023 financial results since more time is needed to complete its financial statements for the quarter, according to a market source.

For fiscal year 2023, net revenue guidance was revised to a range of $4.25 billion to $4.35 billion from a range of $4.625 billion to $4.875 billion, adjusted EBITDA guidance was revised to a range of $725 million to $775 million from a range of $1.22 billion to $1.3 billion, and adjusted net income guidance was revised to a range of $187 million to $228 million from a range of $567 million to $648 million, the company said in an 8-K filed with the Securities and Exchange Commission.

Earlier this month, the company warned that it expected to significantly reduce both its fiscal 2023 net revenue and adjusted EBITDA guidance by more than $400 million each due to productivity issues and higher-than-expected costs at three of the company’s facilities, significant issues with its forecasts over the past year that have recently been identified and potential non-cash adjustments related to its operations in Bloomington, Ind.

Catalent is a Somerset, N.J.-based provider of development sciences and manufacturing platforms for medicines.

KinderCare revised

Returning to primary market happenings, KinderCare trimmed its seven-year first-lien term loan to $1.325 billion from $1.4 billion and modified the original issue discount to 95 from 97, a market source remarked.

In addition, changes were made to documentation, including to MFN, incremental debt incurrence and definition of EBITDA.

As before, the term loan is priced at SOFR+500 bps with a 0.5% floor, and has 101 soft call protection for six months.

Recommitments are due at noon ET on Monday, the source added.

Barclays, Goldman Sachs Bank USA, Macquarie Capital (USA) Inc., Deutsche Bank Securities Inc., UBS Investment Bank, BofA Securities Inc., Jefferies LLC and KKR Capital Markets are leading the deal that will be used to refinance the company’s existing debt and pay related fees and expenses.

KinderCare is a Lake Oswego, Ore.-based provider of private early childhood care and education.

Loan indices mixed

In other news, IHS Markit’s iBoxx loan indices were mixed on Thursday, with the Leveraged Loan indexes (MiLLi) closing out the day down 0.01% and the Liquid Leveraged Loan indices (LLLi) closing out the day unchanged.

Month to date, the MiLLi is down 0.19% and year to date it is up 3.85%, and the LLLi is down 0.51% month to date and up 3.93% year to date.

Average secondary market bids in the U.S. on Thursday were 91.07, down 0.02% from the previous day and down 0.88% year to date.

According to the IHS Markit data, some of the top advancers on Thursday were Air Medical’s March 2018 covenant-lite term loan at 68.15, up from 66, United Road Services’ September 2017 covenant-lite term loan B at 30.8, up from 30, and HealthChannels’ April 2018 covenant-lite term loan at 57, up from 56.

Some top decliners on Thursday were Heritage Power’s July 2019 term loan at 27.91, down from 29.71, Tortoise Investments’ January 2018 covenant-lite term loan at 51.2, down from 54.25, and Genesis Care’s March 2020 U.S. covenant-lite term loan B at 27.85, down from 29.5.

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