JBS prices rich; oversubscribed Kestra upsizes; bank loan funds see 23rd straight outflow

By Paul A. Harris

Portland, Ore., April 26 – On Friday JBS USA Lux SA priced its $1.9 billion seven-year term loan B (Ba2) with a 250 basis points spread to Libor at 99.75, rich to earlier talk of 99.5.

Kestra Financial Inc. upsized its oversubscribed seven-year term loan to $425 million from $410 million and set the spread at the tight end of spread talk.

And the dedicated bank loan funds saw $237 million of cash outflows in the week to Wednesday’s close, according to a market source.

It was the 23rd consecutive weekly outflow, the source added.

JBS USA prices at 99.75

JBS USA priced its $1.9 billion seven-year term loan B (Ba2) with a 250 bps spread to Libor at 99.75, according to a market source who added that the deal allocated on Thursday.

The issue price increased from 99.5.

Also, the MFN sunset was revised to 24 months from 12 months, the source said.

The loan also includes a 0% Libor floor and 101 soft call protection for six months.

Barclays was the bookrunner on the deal and a joint lead arranger with BMO Capital Markets, RBC Capital Markets, Rabobank, SunTrust Robinson Humphrey and U.S. Bank.

Proceeds will be used to help refinance an existing term loan B due 2022.

Other funds for the term loan B refinancing will come from $150 million of add-on 5 7/8% senior notes due 2024, $150 million of add-on 5¾% senior notes due 2025, $400 million of add-on 6½% senior notes due 2029 and cash from the balance sheet.

JBS is a Greeley, Colo.-based animal protein products processing company.

Radiology Partners sets talk

Radiology Partners Inc. talked its fungible $240 million incremental first-lien term loan B with a 475 bps spread to Libor with a 0% Libor floor, according to a market source.

The deal is being offered to new money investors at 99 and features 101 soft call protection for six months.

Barclays, Deutsche Bank Securities, Fifth Third Bank and Golub are the bookrunners on the deal.

The company is also getting a $120 million privately placed incremental second-lien term loan, the source said.

Proceeds will be used to fund acquisitions currently under letters of intent.

New Enterprise Associates is the sponsor.

Radiology Partners is an El Segundo, Calif.-based radiology physician practice management company.

Kestra upsizes

Kestra Financial Inc. upsized its oversubscribed seven-year term loan to $425 million from $410 million and finalized talk at Libor plus 425 bps, with a 0% Libor floor, at 99, according to a market source.

The spread comes at the tight end of the 425 to 450 bps spread talk.

There are no step-downs.

In addition to the 101 soft call protection for six months, the deal features 50 bps of MFN protection for 12 months.

Books were scheduled to close Friday. The deal allocates on Monday.

The company’s upsized $500 million (from $485 million) of credit facilities (B3/B+) also include a $75 million five-year revolver.

UBS Investment Bank, Credit Suisse Securities (USA), Bank of America Merrill Lynch, Goldman Sachs Bank USA and SunTrust Robinson Humphrey are the leads on the deal.

Proceeds will be used to help fund the buyout of the company by Warburg Pincus LLC. Stone Point Capital LLC, Kestra Financial’s current majority owner, will maintain a minority stake in the company.

Closing is expected in the second quarter or early in the third quarter, subject to customary regulatory approvals.

The additional proceeds resulting from the $15 million upsizing of the term loan will be used to fund cash on the balance sheet.

Kestra Financial is an Austin, Texas-based provider of an advisor platform to financial professionals.

Conterra sets final terms

Conterra Ultra Broadband finalized pricing on its $365 million credit facility, according to a market source.

A $250 million seven-year covenant-lite first-lien term loan B priced with a 450 bps spread to Libor, at the wide end of the 425 to 450 bps spread talk. The tranche, which has a 0% Libor floor, priced at 99.5, rich to the 99 price talk.

The $65 million eight-year covenant-lite second-lien term loan priced with an 800 bps spread to Libor, 25 bps inside of the 825 to 850 bps talk. The second-lien tranche, which also has a 0% Libor floor, came on top of price talk at 98.50.

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 company’s $365 million of credit facilities also provide for a $50 million Libor plus 425 bps five-year revolver, with a 0% Libor floor, which priced at 99.5.

TD Securities (USA) was the lead arranger on the deal.

Proceeds will be used to refinance existing debt and for general corporate purposes.

Conterra is a provider of bandwidth infrastructure services.

Neovia finalizes pricing

Neovia Logistics finalized pricing on its $325 million five-year covenant-lite first-lien term loan with a 650 bps spread to Libor, atop spread talk, with a 0% Libor floor and an original issue discount of 97, at the cheap end of the 97 to 98 price talk, according to a market source.

The term loan has call protection of 105 for 18 months, 101 for months 19 through 30 and par onwards, the source said.

There is no amortization on the term loan.

Goldman Sachs Bank USA and Macquarie Capital (USA) were the leads.

The company’s $600 million of credit facilities also include a $75 million super-senior revolving credit facility and a $200 million privately placed second-lien term loan.

Proceeds will be used to help fund a comprehensive recapitalization, which will refinance the company’s entire balance sheet, including its existing revolver, secured notes and unsecured notes.

Other funds for the transaction will come from up to $165 million of preferred equity.

GS Merchant Banking Division and Rhone Group are the sponsors.

Neovia is an Irving, Tex.-based third-party logistics company.

VeriFone sets lender call

VeriFone Systems, Inc. set a lender call for 10:30 a.m. ET on Monday for a $300 million fungible, incremental first lien term loan due Aug. 20, 2025 (B1/B), according to a market source.

The deal comes with a 400 bps spread to Libor and a 0% Libor floor, the same as the existing loan.

As with the existing loan there is no call protection.

Commitments are due Thursday.

Credit Suisse is the lead arranger.

The San Jose, Calif.-based provider of electronic payment services and technologies plans to use the proceeds for general corporate purposes including possible mergers and acquisitions.

Sound Physicians trims discount

Sound Physicians trimmed the discount on its fungible $35 million incremental first-lien term loan due June 2025 (Ba3/B) with higher price talk, according to a market source.

New talk trims the OID, now 99.5 to 99.75, from earlier talk of 99.

Spread talk remains Libor plus 275 bps with a 0% Libor floor, in line with existing first-lien term loan pricing.

Commitments are due Monday.

Goldman Sachs Bank USA is the lead on the deal.

Proceeds will be used to fund tuck in acquisitions currently under letter of intent.

Sound Physicians is a Tacoma, Wash.-based provider of hospital medicine services in the U.S. with services addressing the entire acute episode of care.

Mister Car Wash sets call

Mister Car Wash Holdings, Inc. has scheduled a lender call at 3:30 p.m. ET on Monday to launch a $775 million first-lien term loan, a $40 million delayed-draw first-lien term loan and a $250 million second-lien term loan, according to a market source.

The first-lien loans will have a term of seven years, and the privately placed second-lien loan will have a term of eight years.

The facility also includes a $75 million revolver.

Jefferies, BMO, Nomura and UBS are the arrangers with Jefferies as left lead.

The Tucson-based car wash operator plans to use proceeds to refinance existing debt and pay a distribution to shareholders.

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