Xerium cuts U.S. term pricing; Wyndham ups second-lien spread; NewPage breaks; Calpine gyrates

By Sara Rosenberg

New York, April 22 - Xerium Technologies Inc. made some changes to its credit facility on Friday, including shifting some term loan B funds between the various currency tranches and lowering pricing on the U.S. institutional piece. Meanwhile, Wyndham International Inc. increased pricing on its second-lien term loan and revised call protection provisions to sweeten the deal.

In the secondary, NewPage Corp. broke for trading. Also, Calpine Corp.'s bank debt fell off as bankruptcy rumors made their way around the markets, although once the company came out and denied the speculation, levels did stabilize somewhat.

Xerium's U.S. term loan B was upsized to $339.3 million compared to an original size of $330 million, the euro term loan B was downsized to dollar equivalent $249.3 million compared to an original dollar equivalent size of $264 million and the Canadian term loan B was upsized to dollar equivalent $61.3 million compared to an approximately original dollar equivalent size of $56 million, according to a market source.

In addition, pricing on the U.S. term loan B tranche was lowered to Libor plus 200 basis points from Libor plus 225 basis points, the source said.

Pricing on the Canadian and euro term loan B tranches were left unchanged at Libor plus 225 basis points.

Recommitments are due from lenders on Wednesday.

Xerium's $750 million senior secured credit facility (B1/BB-) also contains a $50 million 61/2-year revolver and a $50 million 364-day revolver, with both revolver tranches priced with an interest rate of Libor plus 225 basis points and an unused fee of 75 basis points.

Citigroup Global Markets Inc. and CIBC are joint lead arrangers and joint bookrunners, with Citigroup the left lead and administrative agent.

The company is getting the new credit facility in connection with its initial public offering of common stock. Closing on the loan is contingent on successful completion of the IPO.

Proceeds from the credit facility and the IPO will be used to refinance existing debt.

Xerium is a Westborough, Mass., supplier of consumables used in the manufacture of paper.

Wyndham ups second-lien pricing

Wyndham increased pricing on its $140 million 61/2-year second-lien term C (Caa1/CCC+) to Libor plus 800 basis points from Libor plus 650 basis points and sweetened call protection provision on the tranche, according to a market source.

The second-lien loan is now non-callable for one year, callable at 103 in year two, 102 in year three and 101 in year four, the source said. Originally, the tranche was launched with call protection of 102 in year one and 101 in year two.

Pricing on Wyndham's $175 million six-year revolver (B3/B), $50 million six-year institutional letter-of-credit facility (B3/B) and $530 million six-year term loan B (B3/B) was left unchanged at Libor plus 325 basis points, the source added.

The revolver is being offered to investors with an upfront fee of 100 basis points, and $10 million to $15 million sized tickets are being sought after.

Proceeds from the $895 million credit facility will be used in combination with proceeds from about $944 million of new CMBS debt to refinance about $1.65 billion of the company's outstanding debt, which would include refinancing its corporate credit facility and the majority of its outstanding mortgage debt.

In addition, through the refinancing the company will have availability to $100 million in pre-funded capital expenditures to invest in owned properties.

As of Dec. 31, 2004, Wyndham had about $68.6 million outstanding under its revolver, $870.8 million outstanding on its term loan I, $284.2 million outstanding on its term loan II, outstanding letters of credit totaling $65.5 million and $932.8 million of mortgage debt outstanding that encumbered 30 hotels and capital leases.

JPMorgan and Bear Stearns are the lead banks on the deal, with JPMorgan the left lead.

Wyndham is a Dallas-based provider of upscale and luxury hotel and resort accommodations.

Trump oversubscribed

Trump Hotels & Casinos Resorts Inc.'s term loan tranches are blowing out with the book "very oversubscribed" even though the deal only launched about a week ago, according to a market source.

The $150 million delayed-draw term loan and $150 million term loan B are both talked at Libor plus 250 basis points. These two term loans are being sold to investors as a strip, the source said.

Some positives working in favor of the deal are that it's "very low levered - funded out of the box, first-lien leverage is less than a turn - and people like the story," the source explained.

Trump's $500 million exit financing facility (B2/BB-) also contains a $200 million revolver talked at Libor plus 250 basis points, which seems to be moving along nicely in terms of syndication as well, the source added.

Morgan Stanley & Co. Inc. and UBS Investment Bank are joint lead arrangers on the deal, with Morgan Stanley the left lead.

Security is a first priority lien on substantially all company assets.

Proceeds will be used to fund immediate capital improvements, as well as certain expansion projects, at current properties, and provide financial resources to potentially invest in additional jurisdictions.

The facility is being sought after in connection with the company's recapitalization plan, under which it was required to file for Chapter 11. Trump anticipates emerging from bankruptcy in early May as Trump Entertainment Resorts Inc. The company filed for bankruptcy on Nov. 22.

Under the reorganization plan, Trump Hotels & Casino Resorts Holdings LP and Trump Hotels & Casino Resorts Funding Inc. would issue new 8.5% 10-year notes to help replace some of the company's existing bond debt. These new notes are secured by substantially all real property and incidental personal property and some other assets, subject to liens securing the $500 million exit facility.

Holder of the approximately $1.3 billion Trump Atlantic City Associates notes would get about $777.3 million of new notes, about $384.3 million of common stock and an additional amount in cash equal to simple interest accrued on about $777.3 million of new notes at the annual rate of 8.5% from the last scheduled date to which interest was paid with respect to the Trump Atlantic City notes through the effective date of the plan.

Holders of the approximately $425 million Trump Casino Holdings first priority notes would get about $425 million of new notes, $21.25 million in cash, about $8.5 million of common stock and an additional amount in cash equal to simple interest accrued on $425 million at the annual rate of 12.625% through the effective date of the plan.

Unaffiliated holders of the approximately $54.6 million Trump Casino Holdings second priority notes would get about $47.7 million of new notes, about $2.3 million in cash, about $2.1 million of common stock and an additional amount in cash equal to simple interest accrued on $54.6 million at the annual rate of 18.625% from the last scheduled date to which interest was paid with respect to the Trump Casino Holdings second priority notes to the date that is 90 days after the petition date for the Chapter 11 cases and about $47.7 million at the annual rate of 8.5% from the 91st day after the petition date through the effective date of the plan.

Lastly, existing common stockholders would receive nominal amounts of common stock of the recapitalized company

Trump Hotels is an Atlantic City, N.J., hotel and casino owner and operator.

NewPage starts trading

NewPage's credit facility freed up for trading on Friday, with the $750 million term loan B (B1/B) quoted at par ½ bid, 101 offered and the $225 million Escanaba Timber Co. term loan (B3/BB-) quoted at par 5/8 bid, 101 1/8 offered, according to a trader.

Both the term loan B and the timber term loan ended up pricing at Libor plus 300 basis points. The term loan B - most recently - had been talked at Libor plus 275 to 300 basis points.

Originally, it was rumored that the term loan B was talked at Libor plus 250 to 300 basis points and the timber term loan was talked at Libor plus 350 to 375 basis points, but those levels were never really official price talk for the deal.

NewPage's $1.325 billion credit facility also contains a $350 million asset-based revolver with an interest rate of Libor plus 225 basis points.

Proceeds from the $1.325 billion credit facility along with proceeds from a $775 million three-part bond offering that priced Friday will be used to help fund Cerberus Capital Management LP's leveraged buyout of MeadWestvaco Corp.'s papers business and associated timberlands.

Under the terms of the agreement, NewPage will acquire the Papers business for $2.3 billion, which consists primarily of mills located in Chillicothe, Ohio; Escanaba, Mich.; Luke, Md.; Rumford, Maine; and Wickliffe, Ky.

The acquisition is subject to customary closing conditions, including regulatory approvals and financing, and is expected to be completed in the second quarter.

Goldman Sachs and UBS are joint lead arrangers on the credit facility, with Goldman the left lead.

NewPage is a Dayton, Ohio, producer of coated and carbonless papers.

Calpine softer

Calpine Corp.'s second-lien bank debt dropped to as low as 74 on Friday afternoon as rumors of a potential bankruptcy filing swirled around the equity, bond and loan markets, according to a trader.

However, by late day the paper did manage to dust itself off and regain some ground as it headed to 78 bid, 80 offered, the trader said.

Prior to Friday's bankruptcy talk, the San Jose, Calif.-based power company's second-lien debt was quoted at 80 bid, 82 offered.

Furthermore, Calpine's CalGen bank debt was off about half a point on the deal as a result of this latest drama and didn't recoup before day's end, with the second-lien quoted at 96 bid, 97 offered and the first-lien quoted at par ½ bid, 101½ offered.

Around 2:30 p.m. ET, Calpine put out a response to the "false" bankruptcy filing rumors because of the pressure that the company's bonds and equity were feeling during afternoon trading hours.

"While it is not Calpine's policy to respond to market rumors, we feel compelled to comment today to assure the marketplace that these rumors are false. Calpine remains in compliance with its corporate and project indentures. Further, the company assures the market that it has no plans to file for bankruptcy.

"The company continues to move forward on its 2005 financial program focused on reducing corporate debt, enhancing liquidity, and strengthening its long-term contract portfolio."

This company response did help stabilize bank debt levels - especially for the Calpine Corp. second-lien tranche - "but nobody really trusts Calpine management so they don't care what they have to say," the trader said.

"We don't think they have to file. They have ample liquidity [and] no problems until 2007. But people hate management and they keep posting crumby numbers so the noise will continue," the trader added.

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