Sally Beauty frees to trade; Baldwin Risk revises loan; WaterBridge accelerates deadline

By Sara Rosenberg

New York, Sept. 8 – Sally Beauty Holdings Inc.’s term loan B made its way into the secondary market on Friday, with levels quoted above its issue price.

Meanwhile, in the primary market, Baldwin Risk Partners LLC increased the size of its add-on term loan B and tightened the original issue discount, and WaterBridge Midstream Operating LLC moved up the commitment deadline for its incremental term loan B,

Also, Creative Artists Agency LLC released price talk on its incremental term loan B in connection with its lender call, and Fogo de Chao (BCPE Grill Parent Inc.) and Flynn Restaurant Group LP joined the near-term new issue calendar.

Sally Beauty breaks

Sally Beauty’s $399 million term loan B due Feb. 28, 2030 freed to trade on Friday, with levels quoted at par 1/8 bid, par ½ offered, according to a market source.

Pricing on the term loan is SOFR plus 225 basis points with a 0% floor and it was issued at par. The debt has 101 soft call protection for six months.

BofA Securities Inc. is leading the deal that will be used to reprice an existing term loan B down from SOFR plus 250 bps with a 0% floor.

The borrowers are Sally Holdings LLC and Sally Capital Inc.

Sally Beauty is a Denton, Tex.-based retailer and distributor of professional beauty supplies.

Baldwin Risk reworked

Switching to the primary market, Baldwin Risk Partners raised its fungible add-on term loan B due October 2027 to $170 million from $100 million and changed the original issue discount to 99.25 from 99.05, a market source remarked.

The add-on term loan is priced at SOFR+CSA plus 350 bps with a 0.5% floor. CSA is 11.448 bps one-month rate, 26.161 bps three-month rate and 42.826 bps six-month rate.

Recommitments were due at 1 p.m. ET on Friday, the source added.

JPMorgan Chase Bank is the left lead on the deal that will be used to repay some revolver and for general corporate purposes.

Closing is expected on or about Sept. 15.

Pro forma for the transaction, the term loan B will total $1.02 billion.

Baldwin Risk, a subsidiary of BRP Group Inc., is a Tampa, Fla.-based insurance distribution firm.

WaterBridge tweaks timing

WaterBridge Midstream accelerated the commitment deadline for its fungible $150 million incremental term loan B due June 21, 2026 to 5 p.m. ET on Monday from noon ET on Wednesday, according to a market source.

Pricing on the incremental term loan matches existing term loan pricing at SOFR+CSA plus 575 bps with a 1% floor, and the new debt is talked with an original issue discount of 99. CSA is ARRC standard of 11.448 bps one-month rate, 26.161 bps three-month rate and 42.826 bps six-month rate.

The incremental term loan and the existing term loan are getting 101 soft call protection for six months.

Barclays is the left lead on the deal that will be used with cash on hand to redeem series A-1 Conoco preferred equity.

WaterBridge is a Houston-based midstream company that owns and operates extensive permanent water infrastructure systems strategically located in the Delaware and Arkoma basins.

Creative Artists guidance

Creative Artists Agency held its lender call on Friday morning and announced original issue discount talk of 99.04 on its fungible $425 million incremental term loan B (B2/B+) due Nov. 26, 2028, a market source said.

Like the existing term loan B, the incremental term loan is priced at SOFR plus 350 bps with a 0% floor.

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

BofA Securities Inc., BNP Paribas Securities Corp. and Credit Agricole are leading the deal that will be used to repurchase existing shares in support of the acquisition of a majority stake in the company by Artemis, the Pinault family’s investment company, from TPG and for general corporate purposes.

Commitments for the incremental term loan are due at noon ET on Sept. 15, and amendment consents are due at 5 p.m. ET on Thursday, the source added.

Closing on the buyout is expected this year, subject to customary conditions.

Creative Artists is a Los Angeles-based entertainment and sports agency.

Fogo de Chao on deck

Fogo de Chao set a lender call for 1 p.m. ET on Monday to launch a $550 million seven-year covenant-lite term loan B, according to a market source.

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

Commitments are due at noon ET on Sept. 22, the source added.

Deutsche Bank Securities Inc., Jefferies LLC and UBS Investment Bank are leading the deal that will be used to help fund the buyout of the company by Bain Capital Private Equity from Rhone Capital.

Closing is expected this month, subject to customary conditions, including regulatory approvals.

Fogo de Chao is a Dallas-based restaurant chain focused on fire-roasting high-quality meats.

Flynn joins calendar

Flynn Restaurant Group scheduled a lender call for 10 a.m. ET on Monday to launch a fungible $150 million add-on term loan B due Dec. 3, 2028 talked with an original issue discount of 98.76, a market source remarked.

Pricing on the add-on term loan is SOFR+CSA plus 425 bps with a 0.5% floor, in line with the existing term loan pricing. CSA is ARRC standard of 11.448 bps one-month rate, 26.161 bps three-month rate and 42.826 bps six-month rate.

The add-on term loan and existing term loan are getting 101 soft call protection for six months.

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

BofA Securities Inc. is the left lead on the deal that will be used to refinance an existing term loan B due 2025, to repay revolver borrowings and to fund cash to the balance sheet for general corporate purposes.

Flynn Restaurant is a San Francisco-based restaurant franchisee operator.

Fund flows

Actively managed loan fund flows on Thursday were negative $33 million and loan ETFs were positive $67 million, market sources said.

Loan funds reported weekly inflows totaling $97 million, with positive $155 million ETFs. This was the seventh inflow over the past 54 weeks and fifth inflow in the last ten weeks.

Year to date, outflows for loan funds total $18.6 billion, with negative $335 million ETFs, sources added.

Loan indices rise

In other news, IHS Markit’s iBoxx loan indices were stronger on Thursday, with the Leveraged Loan indexes (MiLLi) closing out the day up 0.07% and the Liquid Leveraged Loan indices (LLLi) closing out the day up 0.06%.

Month to date, the MiLLi is up 0.27% and year to date it is up 9.16%, and the LLLi is up 0.09% month to date and up 8.52% year to date.

Average secondary market bids in the U.S. on Thursday were 92.85, up 0.02% from the previous day and up 1.07% year to date.

According to the IHS Markit data, some of the top advancers on Thursday were Air Methods April 2017 covenant-lite term loan B at 28.75, up from 27.33, Numericable/YPSO/Altice’s January 2023 U.S. term loan B14 at 89.75, up from 87.58, and Mad Engine’s June 2021 covenant-lite term loan at 70.83, up from 69.2.

Some top decliners on Thursday were Tradesmen/Tribe Buyer’s February 2017 term loan at 48.91, down from 54.56, Cyxtera’s May 2017 covenant-lite term loan at 56, down from 59.85, and Jo-Ann Stores’ July 2021 covenant-lite term loan B at 32, down from 34.

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