Solenis, Tradesmen, Minimax break; Sound Inpatient, Tenneco tweaked; Invenergy accelerated

By Sara Rosenberg

New York, June 18 – Solenis LLC’s credit facilities freed up for trading on Monday, with the U.S. first-lien term loan quoted above its original issue discount, and Tradesmen International LLC and Minimax hit the secondary market as well.

Over in the primary market, Sound Inpatient Physicians Holdings LLC increased the size of its first-lien term loan, and updated spreads and original issue discounts on its first-and second-lien tranches, Tenneco Inc. downsized its term loan B while also widening the spread and issue price, and upsized its term loan A, and Invenergy Thermal Operating I LLC accelerated the commitment deadline on its term loan.

In addition, Midcoast (AL Midcoast Holdings LLC), Ocwen Financial Corp., GPS Hospitality, Young Innovations Inc. and Epicor Software Corp. released price talk with launch, and Asurion LLC, Focus Financial Partners LLC, QualTek USA LLC and Kepro (Keystone Peer Review Organization Inc.) joined this week’s primary calendar.

Solenis frees up

Solenis’ credit facilities broke for trading on Monday, with the $815 million 5.5-year U.S. covenant-light first-lien term loan quoted at 99½ bid, par ¼ offered, according to a market source.

Pricing on the U.S. first-lien term loan is Libor plus 400 basis points with a 25 bps step-up if the combination with BASF Paper & Water doesn’t close and first-lien leverage is more than 4.75 times and an additional 25 bps step-up if the combination doesn’t close and first-lien leverage is more than 5 times and a 0% Libor floor. The loan was sold at an original issue discount of 99 and has 101 soft call protection for the earlier of one year and the close of the combination.

Along with the first-lien term loan, the company is getting a $400 million six-year covenant-light second-lien term loan priced at Libor plus 850 bps with a 25 bps step-up if the combination doesn’t close and secured leverage is more than 5.75 times and an additional 25 bps step-up if the combination doesn’t close and secured leverage is more than 6 times, and a 0% Libor floor. The debt was issued at a discount of 97 and is non-callable, other than with customary make-whole, until the earlier of one year and the combination closing, and if the combination closes within one year, 103 for the remainder of the year, followed by 102 for a year and 101 for a year.

Solenis euro loan

Solenis is also getting a €375 million 5.5-year euro covenant-light first-lien term loan priced at Euribor plus 425 bps with a 25 bps step-up if the combination doesn’t close and first-lien leverage is more than 4.75 times and an additional 25 bps step-up if the combination doesn’t close and first-lien leverage is more than 5 times and a 0.5% floor. This tranche was issued at a discount of 99 and has 101 soft call protection for the earlier of one year and the close of the combination.

During syndication, the U.S. first-lien term loan was upsized from $700 million as the euro loan was downsized from €475 million, pricing on the U.S. first-lien term loan was lifted from Libor plus 350 bps, pricing on the euro first-lien term loan was raised from Euribor plus 350 bps, the discount on both first-lien term loans firmed at the wide end of revised talk of 99 to 99.5 and wide of initial talk of 99.5, pricing on the second-lien term loan was increased from Libor plus 750 bps and the discount widened from 99, and the second pricing step-ups were added to each term loan.

Also during syndication, the call protection on the first-lien term loans was extended from six months, the call protection on the second-lien term loan was changed from a hard call of 102 in year one and 101 in year two, the maturity of the first-lien term loans was shortened from seven years, the maturity of the second-lien term loan was shortened from eight years and a number of documentation changes were outlined.

Solenis lead banks

Citigroup Global Markets Inc., Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Natixis, RBC Capital Markets, Macquarie Capital (USA) Inc. and ING are leading the Solenis’ $1.85 billion equivalent of senior secured credit facilities, which also include a $200 million multi-currency revolver (B2/B-). Citi is left lead and administrative agent on the first-lien debt, and Bank of America is left on the second-lien debt. Credit Suisse is the agent on the second-lien loan.

Proceeds will be used to refinance existing bank debt in preparation for the combination with BASF’s paper and water chemicals business.

Upon closing of the BASF Paper & Water combination, the first-lien term loans maturity will spring to seven years from the refinancing date and the second-lien term loan maturity will spring to eight years from the refinancing date.

Solenis is a Wilmington, Del.-based producer of specialty chemicals for water intensive industries, including the pulp, paper, oil and gas, chemical processing, mining, biorefining, power and municipal markets.

Tradesmen hits secondary

Tradesmen’s $40 million incremental first-lien term loan due February 2024 began trading, with levels seen at par ¼ bid, a market source said.

Pricing on the incremental loan is Libor plus 450 bps with a 1% Libor floor, which matches existing first-lien term loan pricing, and the new debt was issued at par. The incremental term loan has 101 soft call protection for six months.

On Friday, the issue pricing on the loan was changed from 99.75.

Deutsche Bank Securities Inc. is the left lead on the deal that will be used to refinance second-lien term loan borrowings.

Including the incremental, the first-lien term loan will total $396 million.

Existing lenders are being paid a 12.5 bps amendment consent fee.

Closing is expected this week.

Tradesmen is a Macedonia, Ohio-based agency-based provider of outsourced skilled craftsmen to non-residential construction and industrial contractors.

Minimax updated

Minimax set the issue price on its €514 million seven-year covenant-light term loan B at par, the tight end of revised talk of 99.75 to par and tighter than initial talk of 99.5, according to a market source.

As before, pricing on the euro term loan is Euribor plus 325 bps with a 0% floor.

The company is also getting a $600 million seven-year covenant-light term loan B priced at Libor plus 300 bps with a 0.75% Libor floor and an original issue discount of 99.75, a €40 million six-year revolver and a €150 million six-year guarantee line.

The U.S and euro term loans include two 25 bps pricing step-downs at 4 times and 3 times leverage.

Earlier in syndication, the U.S. term loan was upsized from $585 million and the discount was changed from 99.5, and the step-downs on the term loans were revised to include a six-month margin ratchet holiday from no holiday.

Minimax breaks

By late day, Minimax’s U.S. term loan B made its way into the secondary market and levels were quoted at par bid, par ½ offered, another source added.

Deutsche Bank is the physical bookrunner on the deal, and Commerzbank and Unicredit are bookrunners.

The new debt will be used to refinance existing term loans, to fund a distribution to direct shareholder MV Holding to fund a share buyback, and, due to the recent upsizing, to put additional cash on the balance sheet.

Minimax is a fire protection company with headquarters in Bad Oldesloe in Schleswig-Holstein, Germany.

Sound Inpatient reworked

In more happenings, Sound Inpatient Physicians Holdings lifted its seven-year first-lien term loan (Ba3/B) to $575 million from $545 million, set pricing at Libor plus 300 bps, the low end of the Libor plus 300 bps to 325 bps talk, added a 25 bps step-down at 0.5 times inside closing date net first-lien leverage and moved the original issue discount to 99.75 from 99.5, according to a market source.

In addition, the company cut pricing on its $215 million eight-year second-lien term loan (B3/CCC+) to Libor plus 675 bps from talk in the range of Libor plus 700 bps to 725 bps and tightened the discount to 99.5 from 99, the source said.

As before, the first-lien term loan has a 0% Libor floor and 101 soft call protection for six months, and the second-lien term loan has a 0% Libor floor and call protection of 102 in year one and 101 in year two.

The company’s now $865 million of credit facilities also include a $75 million revolver (Ba3/B).

Goldman Sachs Bank USA, Jefferies LLC, Credit Suisse Securities (USA) LLC and Nomura are leading deal, with Goldman left on the first-lien and Jefferies left on the second-lien.

Sound Inpatient shuts books

Recommitments for Sound Inpatient’s credit facilities were due at noon ET on Monday, the source added.

The debt will be used to fund the buyout of the company by Summit Partners and OptumHealth Holdings for about $2.15 billion from Fresenius Medical Care, with the funds from the first-lien term loan upsizing reducing the equity contribution.

Closing is expected late this year, subject to regulatory approvals.

Sound Inpatient Physicians is a Tacoma, Wash.-based provider of hospital medicine and services across the acute episode of care.

Tenneco modifies deal

Tenneco trimmed its seven-year term loan B to $1.7 billion from $1.8 billion, lifted pricing to Libor plus 275 bps from talk in the range of Libor plus 225 bps to 250 bps, added a 25 bps step-up if corporate ratings are lower than Ba3/BB- and revised the original issue discount to 99 from 99.5, according to a market source.

The term loan B still has a 0% Libor floor and 101 soft call protection for six months.

With the term loan B downsizing, the company raised its term loan A to $1.7 billion from $1.6 billion, the source said.

The company’s $4.9 billion of credit facilities (Ba2/BB/BB+) also include a $1.5 billion revolver.

J.P. Morgan Securities LLC and Barclays are leading the deal.

Tenneco funding acquisition

Proceeds from Tenneco’s credit facilities will be used to help fund the purchase of Federal-Mogul from Icahn Enterprises LP for $5.4 billion through a combination of cash and stock, and the assumption of debt, and to refinance existing senior credit facilities at both companies.

Pro forma net debt-to-adjusted EBITDA at closing will be about 3 times.

Tenneco intends to separate the combined businesses into two independent, publicly traded companies through a tax-free spinoff to shareholders that will establish an aftermarket & ride performance company and a powertrain technology company. The separation is expected to occur in the second half of 2019.

Closing on the Federal-Mogul acquisition is expected in the second half of 2018, subject to regulatory and shareholder approvals and other customary conditions.

Tenneco is a Lake Forest, Ill.-based designer, manufacturer and marketer of ride performance and clean air products and systems for automotive and commercial vehicle original equipment markets and the aftermarket. Federal-Mogul is a Southfield, Mich.-based supplier to original equipment manufacturers and the aftermarket.

Invenergy moves deadline

Invenergy Thermal Operating accelerated the commitment deadline on its $350 million seven-year first-lien term loan (Ba2) to 5 p.m. ET on June 25 from 5 p.m. ET on June 27, a market source remarked.

Talk on the term loan is Libor plus 375 bps with a 0% Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months.

Credit Suisse Securities (USA) LLC and Goldman Sachs Bank USA are leading the deal that will be used to refinance existing debt.

Invenergy is a Chicago-based operator of power generation facilities.

Midcoast details emerge

Also in the primary market, Midcoast came out with size and price talk on its term loan B a few hours before its Monday afternoon bank meeting kicked off, according to a market source.

The seven-year first-lien term loan B launched as a $600 million tranche talked at Libor plus 500 bps with a 0% Libor floor and an original issue discount of 99, the source said.

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

Commitments are due at noon ET on June 28.

Credit Suisse Securities (USA) LLC, Barclays and MUFG are leading the deal that will be used to fund the buyout of the company by ArcLight Capital Partners LLC from Enbridge Inc.

Closing is expected in the third quarter, subject to regulatory approvals and other customary conditions.

Midcoast is a provider of natural gas and natural gas liquids services.

Ocwen reveals talk

Ocwen Financial disclosed talk of Libor plus 450 bps with a 1% Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months on its $350 million six-year senior secured term loan B (B+) that launched with an afternoon call, a market source remarked.

Commitments are due at noon ET on June 28, the source added.

Barclays is the left lead on the deal that will be used to refinance the company’s existing senior secured term loan and fund cash to the balance sheet for general corporate purposes.

Ocwen is a West Palm Beach, Fla.-based non-bank mortgage servicer and originator.

GPS sets guidance

GPS Hospitality held its bank meeting in the afternoon, launching its $340 million seven-year first-lien term loan at talk of Libor plus 475 bps with no Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months, a market source said.

The company’s $405 million of credit facilities also include a $65 million revolver.

Commitments are due on June 28, the source added.

UBS Investment Bank is the left lead on the deal that will be used to refinance existing debt.

GPS Hospitality is an Atlanta-based Burger King and Popeyes Louisiana Kitchen franchisee.

Young Innovations launches

Young Innovations announced talk of Libor plus 350 bps with a 25 bps step-down, a 0% Libor floor, a par issue price and 101 soft call protection for six months on its $294 million funded term loan that launched with an afternoon call, a market source remarked.

Commitments are due on Thursday, the source added.

Jefferies LLC is leading the deal that will reprice an existing term loan down from Libor plus 400 bps with a 25 bps step-down and a 1% Libor floor.

Young Innovations is an Algonquin, Ill.-based developer and manufacturer of consumable dental products.

Epicor floats OID

Epicor Software launched on its call its fungible $75 million incremental term loan B due June 1, 2022 with original issue discount talk of 99.75, according to a market source.

Like the existing term loan B, the incremental loan is priced at Libor plus 325 bps with a 0% Libor floor.

Jefferies LLC and KKR Capital Markets are leading the deal that will be used to pay down second-lien term loan borrowings.

Commitments are due at 3 p.m. ET on Wednesday and amendment consents are due at 3 p.m. ET on Thursday, the source added.

Lenders are being offered a 5 bps consent fee on the amendment.

Epicor is an Austin, Texas-based provider of enterprise business software services.

Asurion joins calendar

Asurion surfaced with plans to hold a lender call at 12:30 p.m. ET on Tuesday to launch $3.75 billion in term loans, a market source said.

The debt consists of a $2.25 billion covenant-light first-lien term loan B-7 (B+) due November 2024 and a $1.5 billion add-on covenant-light second-lien term loan (B-) due Aug. 4, 2025, the source added.

Bank of America Merrill Lynch, Morgan Stanley Senior Funding Inc., Goldman Sachs Bank USA, Barclays, Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc. are leading the deal that will be used to fund a share repurchase/return of capital.

Asurion is a Nashville-based provider of technology protection services.

Focus joins calendar

Focus Financial Partners set a lender call for 11 a.m. ET on Tuesday to launch $953 million in term loans, a market source remarked.

The debt is split between an $803 million term loan B and a $150 million delayed-draw term loan B, the source added.

RBC Capital Markets and SunTrust Robinson Humphrey Inc. are leading the deal that will be used to refinance the company’s capital structure.

Stone Point Capital LLC and Kohlberg Kravis Roberts & Co. LP are the sponsors.

Focus Financial is a New York-based partnership of independent, fiduciary wealth-management firms.

QualTek on deck

QualTek will hold a bank meeting at 10 a.m. ET on Thursday to launch a $290 million seven-year first-lien term loan led by Fifth Third Bank, a market source said.

The company is also getting a $65 million ABL revolver led by PNC.

The new debt will be used to help fund the buyout of the company by Brightstar Capital Partners.

QualTek is a King of Prussia, Pa.-based provider of turnkey solutions, including engineering, installation, fulfillment and program management, to the telecommunications and power sectors.

Kepro readies loan

Kepro scheduled a lender call for Tuesday to launch a fungible $27.5 million add-on first-lien term loan due May 2024, according to a market source.

The add-on loan is priced at Libor plus 525 bps with a 1% Libor floor, in line with existing first-lien term loan pricing, the source said. Original issue discount talk is not yet available.

Commitments are due at 5 p.m. ET on June 28, the source added.

RBC Capital Markets LLC is leading the deal that will be used to fund an acquisition.

Kepro is a Harrisburg, Pa.-based quality improvement and care management organization.

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