Ineos Group revisions surface; Starwood Property accelerates deadline; Yum! trades higher

By Sara Rosenberg

New York, Nov. 2 – In the primary market, Ineos Group Holdings increased the size of its U.S. and its euro term loans twice during Wednesday’s session, firmed spreads at the low end of guidance and tightened original issue discounts.

Additionally, Starwood Property Mortgage LLC moved up the commitment deadline for its first-lien term loan B.

Meanwhile, in the secondary market, Yum! Brands Inc.’s term loan was a little stronger following the release of the company’s third quarter results.

Ineos reworked

Ineos Group lifted its five-year U.S. term loan B to $1.2 billion on Wednesday, not long after increasing it to $1 billion in the morning from an initial size of $750 million, and firmed pricing at SOFR plus 375 basis points, the low end of the SOFR plus 375 bps to 400 bps talk, according to a market source.

Furthermore, the company raised its five-year euro term loan B to €800 million from a revised amount in the morning of €650 million and an initial size of €400 million, and set pricing at Euribor plus 400 bps, the low end of the Euribor plus 400 bps to 425 bps talk, the source said.

Also, the original issue discount on both term loans finalized at 96.5, the tight end of the revised talk of 96 to 96.5 that came out in the morning and tighter than initial talk in the range of 95 to 96.

As before, both term loans have a 0% floor and 101 soft call protection for one year, and the U.S. term loan has 10 bps CSA.

Commitments continued to be due at 5 p.m. ET on Wednesday and allocations are expected on Thursday, the source added.

Ineos lead banks

JPMorgan Chase Bank and Deutsche Bank Securities Inc. are the joint global coordinators on Ineos’ term loans, with JPMorgan the left lead and sole physical bookrunner on the U.S. piece, and Deutsche and JPMorgan joint physical bookrunners on the euro piece. ABN Amro, Barclays, Credit Agricole, Commerzbank, ING, Intesa, KBC and MUFG are mandated lead arrangers. Barclays is the administrative agent.

The new debt will be used to extend, in part, the U.S. and euro term loan Bs due March 2024 by 3½ years and for general corporate purposes.

The U.S. borrower is Ineos US Finance LLC and the euro borrower is Ineos Finance plc.

Ineos is a London-based chemicals company.

Starwood tweaks timing

Starwood Property accelerated the commitment deadline for its $400 million five-year first-lien senior secured sustainability term loan B (Ba2//BBB-) to 5 p.m. ET on Wednesday from 5 p.m. ET on Thursday, a market source remarked.

Talk on the term loan is SOFR plus 350 bps to 375 bps with 0 bps CSA, a 0.5% floor, an original issue discount of 97 and 101 soft call protection for six months.

Morgan Stanley Senior Funding Inc. is the left lead arranger on the deal that will be used to finance or refinance, in whole or in part, recently completed or future eligible green and/or social projects. Pending full allocation of an amount equal to the net proceeds to eligible green and/or social projects, the company intends to use the net proceeds to repay repurchase facilities.

Starwood Property Mortgage is a commercial mortgage real estate investment trust.

Yum! inches up

Switching to the secondary market, Yum! Brands’ term loan moved higher in trading on Wednesday after the company’s third quarter numbers were announced, a market source said.

The term loan was quoted at 98¾ bid, 99½ offered, up from 98 5/8 bid, 99 3/8 offered, the source said.

For the quarter, the company reported net income of $331 million, or $1.14 per diluted share, versus net income of $528 million, or $1.75 per diluted share.

Revenues for the quarter were $1.64 billion, up slightly from $1.606 billion in the comparable period in 2021, and worldwide system sales excluding foreign currency translation grew 7%, with 5% same-store sales growth and 4% unit growth.

Yum! Brands is a Louisville, Ky.-based quick-service restaurant operator.

Loan indices rise

IHS Markit’s iBoxx loan indices were stronger on Tuesday, with the Leveraged Loan indexes (MiLLi) closing out the day up 0.16% and the Liquid Leveraged Loan indices (LLLi) closing out the day up 0.24%.

Month to date, the MiLLi is up 0.16% and year to date its down 2.6%. The LLLi is up 0.24% month to date and down 3.2% year to date.

Average secondary market bids in the U.S. on Tuesday were 92.35, up 0.01% from the previous day and down 4.65% year to date.

According to the IHS Markit data, some of the top advancers on Tuesday were Rackspace Hosting’s February 2021 covenant-lite term loan B at 65.25, up from 63.03, Heritage Power’s July 2019 term loan at 33.93, up from 32.81, and Cineworld’s February 2018 U.S. covenant-lite term loan at 32, up from 31.29.

Some top decliners on Tuesday were Clarion Events’ February 2018 covenant-lite term loan B2 at 58.57, down from 60.21, MedPlast’s July 2018 second-lien covenant-lite term loan at 88.31, down from 89.38, and ACProducts/Cabinetworks’ May 2021 first-lien term loan B at 68.54, down from 69.35.

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