Calpine dips with paydown; UCI, CommScope rework deals; Oriental Trading reveals talk

By Sara Rosenberg

New York, Jan. 10 - Calpine Corp.'s old term loan was softer during Monday's trading session as investors are expecting to be repaid, and CityCenter Holdings LLC's term loans were quoted tighter as it too announced paydown plans.

Moving to the primary, UCI International Inc. revised the size of its term loan and some are expecting a pricing change to follow, and CommScope Inc. reduced the spread and original issue discount on its loan.

Also, Oriental Trading Co. began circulating guidance on its new deal as the company is getting ready to bring the transaction to market later this week, CPI International Inc. firmed up timing on its credit facility and Booz Allen Hamilton Holding Corp. surfaced with plans to launch new term loans.

Calpine old loan slides

Calpine's old term loan headed lower, moving closer to par, as the company is anticipated to repay the debt in full with proceeds from a $1.2 billion senior secured notes offering and cash on hand, according to traders.

The Houston-based power company's old term loan was quoted by one trader at par bid, par 1/8 offered, down from par 3/8 bid, par 5/8 offered, and by a second trader at par bid, par ¼ offered, down from par 3/8 bid, par ¾ offered.

Meanwhile, the company's new term loan was quoted flat to better, depending on which trader was asked.

One trader had the new term loan at 101 5/8 bid, 102 1/8 offered, unchanged on the day, a second trader had it at 101 3/8 bid, 102 offered versus 101½ bid, 102 offered on Friday, and a third trader had it at 101¾ bid, 102¼ offered, up from 101½ bid, 102 offered.

CityCenter moves around

CityCenter also revealed on Monday that it will be repaying a portion of its credit facility debt, and in connection with the news, levels on the company's term loans tightened since those are the borrowings that are expected to be paid down, according to traders.

The initial term loan was quoted by one trader at 99¾ bid, par offered versus 99½ bid, par offered on Friday, and by a second trader at 99¾ bid, par offered, compared to 99¾ bid, par 1/8 offered previously.

The first trader was also seeing the construction term loan quoted at 99¾ bid, par offered versus 99½ bid, par offered.

In addition to the paydown, news emerged that the company is looking to amend and restate its credit facility to extend maturity for four years. Bank of America is the left lead on the transaction that is being done club style with some banks.

CityCenter is a mixed-use development, built on the Las Vegas Strip.

UCI downsizes

Over in the primary, UCI International trimmed its 61/2-year term loan to $350 million from $450 million as its senior unsecured notes offering was increased to $350 million from $250 million, according to a market source, who believes that a pricing change will come next.

The term loan was launched with price talk of Libor plus 450 basis points with a 1.75% Libor floor and an original issue discount of 99. There is 101 soft call protection for one year.

However, the source said that he thinks pricing will tighten to somewhere in the Libor plus 400 bps to 425 bps area before the deal is done, and some other buyside guys agreed with that assessment.

"Size is smaller. Multiple times oversubscribed as the bigger size. Guess pricing will be reduced," the source added.

UCI getting revolver

UCI International's $425 million senior secured credit facility, down from $525 million, still provides for a $75 million revolver.

Ratings for the credit facility under the original structure were Ba3/B.

Credit Suisse, HSBC and Nomura are the lead banks on the deal that will be used, along with the notes, about $320 million of equity and cash on hand, to fund the acquisition of the company by Rank Group Ltd.

The transaction is expected to close in the first quarter, subject to regulatory approvals.

UCI is an Evansville, Ind.-based supplier to the light- and heavy-duty vehicle aftermarket for replacement parts, including filtration, fuel delivery systems, vehicle electronics and cooling systems products.

CommScope lowers pricing

CommScope trimmed pricing on its $1 billion seven-year covenant-light term loan (Ba3/BB) to Libor plus 350 bps from Libor plus 400 bps and tightened the original issue discount to 99½ from 99, while leaving the 1.5% Libor floor and 101 soft call protection intact, according to a market source.

As before, commitments are due at 4 p.m. ET on Tuesday, and closing and funding is expected to occur on Jan. 14.

The company's $1.4 billion senior secured credit facility also includes a $400 million asset-based revolver that was already presented to lenders on Dec. 8.

JPMorgan is the lead bank on the deal that will be used to help fund the acquisition of the company by the Carlyle Group for $31.50 per share in cash. The transaction is valued at $3.9 billion.

CommScope getting notes

Other funding for the buyout of CommScope will come from senior notes, which are expected to price this week, and equity.

Initially, it was thought that the company would get $2.25 billion of bonds for the transaction. Then, it was revealed that the debt could come in the form of notes and a term loan. And, last week, it was disclosed that the company is actually roadshowing $1.5 billion of bonds in addition to the $1 billion term loan - a $250 million increase from what was originally proposed.

Under the original financing plans, the company had said that the equity portion would be $1.75 billion and that $215 million could be drawn under the revolver for the buyout. As a result of the upsizing of bond/term loan debt, the equity portion is being reduced to $1.6 billion.

CommScope leverage multiples

At close, CommScope's secured leverage will be around 2.5 times and total leverage will be around 5.5 times.

Closing on the acquisition is expected to occur in the first quarter. Stockholder approval for the buyout was obtained on Dec. 30, and the company was granted early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 in November.

CommScope is a Hickory, N.C.-based provider of infrastructure services for communication networks.

Oriental Trading floats talk

Oriental Trading revealed price talk on its proposed $200 million first-lien six-year term loan ahead of the Thursday bank meeting that will launch the deal into syndication, according to a market source.

The term loan is being talked at Libor plus 650 bps with a 1.75% Libor floor and an original issue discount of 98, the source said.

Credit Suisse and JPMorgan are the lead banks on the deal that will be used to help fund the company's exit from bankruptcy protection.

Also as part of its exit financing, the Omaha, Neb.-based direct marketer of party and school supplies will be getting a $50 million ABL revolver that is being led by GE Capital.

At close, total leverage will be 3.6 times.

CPI firms launch

CPI International nailed down timing on its proposed $180 million senior secured credit facility, with the scheduling of a bank meeting for Wednesday at 2 p.m. ET at the W Hotel in New York, according to a market source.

Previously, the deal was simply being labeled as January business.

The facility consists of a $150 million six-year term loan and a $30 million five-year revolver, the source said, adding that price talk is not yet being disclosed.

The size of the term loan is minimally different from what the company has outlined in filings with the Securities and Exchange Commission. Those filings had the term loan at $148 million.

UBS Investment Bank is the lead bank on the deal. And, KKR Capital Markets LLC has signed on as syndication agent.

CPI being acquired

Proceeds from CPI's credit facility will be used to help fund its buyout by Veritas Capital for $19.50 per share in cash. The transaction is valued at roughly $525 million.

The company's SEC filings said that other funding for the deal would come from $215 million of senior notes that are backed by a commitment for a $215 million senior unsecured bridge loan, and from $220 million of equity.

Closing is subject to stockholder approval and a number of customary regulatory and other conditions. The transaction is not subject to any financing conditions.

CPI is a Palo Alto, Calif.-based provider of microwave, radio frequency, power and control services for critical defense, communications, medical, scientific and other applications.

Booz Allen readies deal

Booz Allen Hamilton Holding is set to hold a bank meeting on Thursday to launch $1.05 billion of term loan A and term loan B debt (Ba2/BBB-), according to a market source, who said that the break down between the tranche sizes has not yet been determined and may not emerge until launch.

Bank of America, Credit Suisse, Barclays, Morgan Stanley and Sumitomo are the lead banks on the deal that will be used, along with cash on hand, to refinance about $1.021 billion of bank debt and $222 million of mezzanine debt.

The McLean, Va.-based strategy and technology consulting firm company is keeping its existing revolver in place but will extend the maturity to July 2014.

Following the refinancing news, the company's existing term loan B and term loan C were quoted at par bid, 101 offered, a trader remarked. By comparison, on Friday, the term loan B was quoted at par ½ bid.

Data Device closes

In other news, Data Device Corp. announced in a news release on Monday that it completed its dividend recapitalization that was funded through a $340 million credit facility.

The facility consists of a $300 million six-year term loan priced at Libor plus 550 bps with a 1.75% Libor floor, which was sold at a discount of 981/2, and a $30 million five-year revolver.

During syndication, the term loan was downsized from $310 million and pricing was increased from talk of Libor plus 475 bps to 500 bps.

Credit Suisse and GE Capital acted as the lead banks on the deal for the Bohemia, N.Y.-based supplier of data networking services and MIL-STD-1553 interfaces.

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