Swift Transportation, Capital Auto, Hyland break; Associated Asphalt zeroes in on spread

By Sara Rosenberg

New York, Feb. 29 - Swift Transportation Co.'s credit facility hit the secondary market late in the day on Wednesday, and Capital Automotive and Hyland Software saw their incremental term loans free up for trading too.

Over in the primary, Associated Asphalt is likely firming pricing on its term loan B debt at the wide end of guidance, ACCO Brands Corp. upsized its term loans, and Mohegan Tribal Gaming Authority reworked its pro rata tranches, shifting funds out of the revolver and into the term loan A.

In more loan happenings, Gentiva Health Services Inc. made a number of changes to its amendment request, including increasing the proposed coupon and reworking the leverage covenant request.

Furthermore, Sonneborn LLC surfaced with new credit facility plans, Bombardier Recreational Products is coming with an amendment and extension transaction, and Tenneco Inc. started circulating price talk on its upcoming pro rata deal.

Swift frees up

Swift Transportation's credit facility began trading on Wednesday, with the $200 million term loan B-1 (BB) due Dec. 21, 2016 quoted at 99 7/8 bid, par 3/8 offered and the $674 million term loan B-2 (BB) due Dec. 15, 2017 quoted at par 1/8 bid, par 5/8 offered, according to a trader.

During the session, pricing on the term loan B-1 and B-2 finalized at Libor plus 375 basis points, the tight end of the Libor plus 375 bps to 400 bps talk, and a step-down to Libor plus 350 bps at less than 2.75 times gross leverage was added to both loans.

The term loan B-1 has no Libor floor and the term loan B-2 has a 1.25% floor, and both pieces were sold at an original issue discount of 993/4.

Swift getting revolver

Swift Transportation's $1.274 billion credit facility also includes a $400 million revolver due Sept. 21, 2016.

Proceeds will be used to reprice and extend the maturities of the company's existing senior secured credit facility, which consists of a $400 million revolver and a $1.07 billion term loan priced at Libor plus 450 bps with a 1.5% Libor floor.

Bank of America Merrill Lynch, Morgan Stanley Senior Funding Inc. and Wells Fargo Securities LLC are the lead arrangers on the deal.

Swift is a Phoenix-based transportation services company and truckload carrier.

Capital Auto starts trading

Capital Automotive's $200 million add-on term loan B broke for trading on Wednesday, with levels quoted at 99 bid, 99¾ offered, according to a trader. The existing term loan B was also quoted at 99 bid, 99¾ offered, flat from Tuesday, he added.

Pricing on the add-on loan due March 2017 is Libor plus 375 basis points with a 1.5% Libor floor, and it was sold at an original issue discount of 99.

During syndication, the loan was downsized from $230 million, a $170 million delayed-draw term loan was eliminated from the capital structure and pricing was flexed up from Libor plus 350 bps.

As a result of the flex, with the add-on loan, the spread on the company's existing term loan B is being increased to Libor plus 375 bps from Libor plus 350 bps.

The canceled delayed-draw loan was expected to be available until June 30 and included a delayed-draw fee of 50 bps from April 1 through May 1, 100 bps until June 1 and the full drawn spread until June 30.

Capital Auto passes

Along with the add-on loan, Capital Automotive was seeking an amendment to its existing credit facility to allow for the additional debt and make some other minor modifications, and this amendment has been approved by lenders, a source said.

The amendment fee that lenders are receiving is 25 bps, increased from 10 bps earlier this week,

Proceeds from the new term loan B financing will be used to refinance just under $200 million of preferred equity. As a result of the downsizing, the company will no longer be cleaning up some other near-term debt maturities. The delayed-draw portion was going to be used to fund a handful of tuck-in acquisitions.

Barclays Capital Inc. is the lead bank on the deal.

Capital Automotive is a McLean, Va.-based provider of sale-leaseback capital to the automotive retail industry.

Hyland tops OID

Also freeing up was Hyland Software's $80 million incremental first-lien term loan (B2/B+), with levels seen at par bid, par ¾ offered, according to a source. The incremental and the existing term loan trade as one tranche.

Pricing on the add-on loan is Libor plus 475 bps with a 1.25% Libor floor, and it was sold at an original issue discount of 99 after tightening recently from 98.

Credit Suisse Securities (USA) LLC is leading the deal that will be used to fund a dividend.

In connection with the transaction, the company is amending its existing credit facility to allow for the dividend, and consenting term loan lenders are getting repriced from Libor plus 425 bps with a 1.5% Libor floor to match the incremental loan pricing.

Lenders were offered a 20 bps amendment fee.

Hyland Software is a Westlake, Ohio-based enterprise content management software vendor.

Caesars bounces around

In more trading news, Caesars Entertainment Operating Co. Inc.'s term loans were a mixed bag following the release of earnings that showed an increase in net loss from the previous year, but an improvement in adjusted EBITDA, according to traders.

One trader had the term loans B1, B2 and B3 quoted at 94 bid, 95 offered, up from 93¾ bid, 94¾ offered, the term loan B4 at 102¾ bid, 103¼ offered, unchanged on the day, the term loan B5 flat at 86½ bid, 87½ offered, and the term loan B6 at 90¾ bid, 91½ offered, down from 91 bid, 92 offered.

A second trader, meanwhile, had the term loans B1, B2 and B3 quoted at 93¾ bid, 94 offered, versus 93 5/8 bid, 94 1/8 offered on Tuesday, the term loan B4 at 103 bid, 104 offered, up from 102¼ bid, 103¼ offered, and the term loan B6 at 90¾ bid, 91½ offered, compared to 91 bid, 91½ offered previously.

Caesars earnings details

For the fourth quarter, parent company Caesars Entertainment Corp. reported a net loss of $220.6 million, compared to a net loss of $196.7 million in the prior year, net revenues for the quarter were $2.17 billion, up 2.4% from $2.12 billion in the fourth quarter of 2010, and adjusted EBITDA was $466 million, a 5.9% improvement from $439.9 million in the previous year.

As for Caesars Entertainment Operating, which is where a substantial portion of debt is held, net loss for the quarter was $246.9 million, compared to a net loss of $219.2 million in the 2010 fourth quarter, net revenues were $1.64 billion, down 0.6% from $1.66 billion, and adjusted EBITDA was $351.3 million, up 0.3% from $350.1 million in the prior year.

Caesars is a Las Vegas-based diversified casino-entertainment company.

Associated Asphalt pricing

Moving to the primary, Associated Asphalt is expected to finalize pricing on its $190 million six-year term loan B at Libor plus 575 bps, the high end of the Libor plus 550 bps to 575 bps talk, according to a market source, who said that the 1.5% floor and original issue discount of 98 will remain intact.

The institutional debt is comprised of a $170 million funded piece and a $20 million six-month delayed-draw piece that are being sold together.

Proceeds from the company's $280 million credit facility (B2/B+), which also includes a $90 million five-year revolver governed by a borrowing base, will be used to help fund the buyout of the company by Goldman Sachs Capital Partners.

KeyBanc Capital Markets LLC is the bookrunner on the deal and a lead arranger with Nomura and Fifth Third Securities Inc.

Associated Asphalt, a Roanoke, Va.-based supplier of liquid asphalt to the paving industry, will have total leverage of around 3.4 times.

ACCO upsizes

ACCO Brands lifted its five-year term loan A to $320 million from $300 million and its seven-year term loan B to $450 million from $370 million so that it could redeem some of its 7 5/8% senior subordinated notes, according to a market source.

Pricing on the term loan A, as well as on a $250 million five-year revolver, is Libor plus 300 bps, and pricing on the term loan B is Libor plus 325 bps (after flexing earlier from Libor plus 375 bps) with a 1% Libor floor and an original issue discount of 99. The B loan has 101 soft call protection for one year.

Barclays Capital Inc., Bank of America Merrill Lynch and Bank of Montreal are the lead banks on the now $1.02 billion senior secured credit facility (Ba2/BB+/BB+), up from $920 million.

Recommitments are due at the close of business Thursday.

ACCO funding merger

As before, ACCO's credit facility will also be used to fund its merger with MeadWestvaco's office supplies business, repay 10 5/8% senior secured notes and for ongoing working capital requirements.

For the merger, MeadWestvaco will establish a separate entity to hold the consumer & office products business, the shares of which will be distributed to meadwestvaco shareholders in a tax-free transaction in return for a $460 million dividend to MeadWestvaco from the new entity. Immediately after the spin-off and distribution, the newly formed company will merge with a subsidiary of ACCO.

Closing is expected in the second quarter, subject to approval by ACCO shareholders. Hart-Scott-Rodino and Canada Competition Act clearance have already been obtained.

ACCO Brands is a Lincolnshire, Ill.-based office supply manufacturer.

Mohegan reworks tranching

Mohegan Tribal Gaming Authority revised the structure of its credit facility, increasing the term loan A due March 31, 2015 to $400 million from $275 million and decreasing the revolver due March 31, 2015 to $75 million from $200 million, a market source said.

According to company disclosures, pricing on the revolver and term loan A is expected to range from Libor plus 350 bps to 450 bps, based on leverage, and the revolver unused fee will range from 25 bps to 50 bps.

In addition to the pro rata debt, the company is a getting a $225 million last-out, first-loss term loan (B3) that is non-callable for two years, then at par.

Size and pricing on the last-out term loan were left unchanged, with it firming at Libor plus 750 bps with a 1.5% Libor floor and an original issue discount of 98.

Proceeds will be used to refinance an existing credit facility.

Mohegan lead banks

Wells Fargo Securities LLC, Bank of America Merrill Lynch and Credit Suisse Securities (USA) LLC are the lead banks on Mohegan's credit facility, with Bank of America the left lead on the revolver and term loan A and Wells Fargo the left lead on the last-out loan.

The new bank debt is being done in connection with the company's private par exchange offers, for which the early tender deadline has been pushed back a number of times.

As of Tuesday, the company had received enough tenders to satisfy the minimum threshold for its 11½% second-lien senior secured notes due 2017 and its 7 1/8% senior subordinated notes due 2014 and 6 7/8% senior subordinated notes due 2015 combined, but not for its 8% senior subordinated notes due 2012 and 6 1/8% senior notes due 2013 combined.

On Wednesday the private exchange offers were amended to lower the participation level for the minimum condition for the 6 1/8% and 8% notes.

Mohegan is an Uncasville, Conn., operator of gaming and entertainment enterprises.

Gentiva tweaks amendment

Gentiva reworked its credit facility amendment so that investors are now offered pricing of Libor plus 525 bps on the term loan A and B, up from an earlier offer of Libor plus 475 bps, according to a market source. Current pricing on the A loan is Libor plus 325 bps and on the B loan is Libor plus 350 bps.

Also, the company is now asking to revise the leverage covenant to 6.25 times through September 2014, with a step-down to 5.75 times thereafter, whereas, before its was seeking a covenant of 6.0 times, with a step-up to 6.5 times this year, and a step-down thereafter.

In return for consents, lenders will get a 50 bps amendment fee, increased from the originally proposed 25 bps, the source remarked.

Unchanged is the company's plan to repay $50 million of its term loan borrowings and reduce its revolver commitment by $15 million if the amendment is approved.

Lead bank, Bank of America Merrill Lynch, was seeking consents by 4 p.m. ET.

Gentiva is an Atlanta-based provider of home health and hospice services.

Sonneborn readies deal

In other news, Sonneborn joined this week's calendar, setting a bank meeting for 1 p.m. ET on Thursday to launch a proposed $270 million credit facility, according to a market source.

The facility consists of a $30 million five-year revolver and a $240 million six-year term loan B, the source said, adding that price talk is not yet available.

Macquarie Capital and BMO Capital Markets Corp. are the lead banks on the deal that will be used to fund the acquisition of the company by One Equity Partners from Sun Capital Partners Inc.

Sonneborn is a Parsippany, N.J.-based manufacturer and supplier of high-purity specialty hydrocarbons.

Bombardier amend, extend

Bombardier Recreational Products will be holding a conference call at 2 p.m. ET on Thursday to launch an amendment and extension proposal, under which it is seeking to push out the maturity on its term loan (B1) by three years to June 2016, according to a market source.

BMO Capital Markets Corp., RBC Capital Markets LLC and UBS Securities LLC are leading the deal.

Bombardier is a Valcourt, Quebec-based designer manufacturer, distributor and marketer of motorized recreational vehicles and powersports engines.

Tenneco floats talk

Tenneco told investors that it is talking its $950 million pro rata credit facility at Libor plus 250 bps as the company is gearing up to launch the deal with a bank meeting on Thursday, according to a market source.

The facility consists of a $700 million revolver and a $250 million term loan A, the source said.

J.P. Morgan Securities LLC is the lead bank on the deal that will be used to refinance existing debt.

As of Dec. 31, 2011, the company's senior credit facility consisted of a $148 million term loan B maturing in June 2016, a $130 million tranche B-1 letter of credit/revolver loan facility maturing in March 2014, and a $622 million revolver that is scheduled to be reduced by $66 million on March 16.

Tenneco is a Lake Forest, Ill.-based designer, manufacturer and seller of emission control and ride control products and systems for light, commercial, and specialty vehicle applications.

Hawaiian Telcom closes

Hawaiian Telcom completed its $300 million first-lien five-year term loan (B1) that is priced at Libor plus 575 bps with a 1.25% Libor floor, and was sold at an original issue discount of 981/2, according to a news release. There is soft call protection of 102 in year one and 101 in year two.

Credit Suisse Securities (USA) LLC led the deal that was used to refinance an existing term loan.

Hawaiian Telcom is a Honolulu-based provider of integrated communications services.

Freescale wraps loan

Freescale Semiconductor Inc. closed on its $500 million seven-year senior secured incremental term loan B (B1/B/B-), according to a news release.

Pricing on the loan is Libor plus 475 bps, after firming recently at the high end of the Libor plus 450 bps to 475 bps talk, with a 1.25% Libor floor. There is 101 soft call protection for one year and the debt was sold at an original issue discount of 99.

J.P. Morgan Securities LLC and Citigroup Global Markets Inc. led the deal that is being used to redeem $500 million of the the company's 10 1/8% senior subordinated notes due December 2016.

Freescale is an Austin, Texas-based designer and manufacturer of embedded semiconductors for the automotive, consumer, industrial, networking and wireless markets.

Noranda completes loan

Noranda Aluminum Holding Corp., a Franklin, Tenn.-based producer of aluminum products and rolled aluminum coils, closed on its $575 million credit facility consisting of a $250 million five-year ABL revolver and a $325 million seven-year term loan (Ba2), according to a news release.

Pricing on the revolver is Libor plus 175 bps and pricing on the term loan is Libor plus 450 bps with a 1.25% Libor floor, and it was sold at a discount of 991/4. There is 101 soft call protection for one year.

During syndication, the term loan was upsized from $300 million, pricing firmed at the tight end of the Libor plus 450 bps to 475 bps talk and the discount tightened from 99.

Bank of America Merrill Lynch, Citigroup Global Markets Inc., UBS Securities LLC, Barclays Capital Inc., Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. led the deal that was used to repay an existing term loan B, to fund a tender offer for senior floating-rate notes due 2015, to fund a dividend of about $1.25 per share and for general corporate purposes.

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