Interactive Data, Universal Health, PSC, GEO Group slate launches; CamelBak inches up

By Sara Rosenberg

New York, June 22 - Two significantly sized deals hopped onto this week's new issue calendar on Tuesday, with the first one being Interactive Data Corp. and the second one being Universal Health Services Inc., and smaller deals for PSC LLC and GEO Group Inc. joined as well.

Also on the new deal front, SonicWALL Inc.'s first-lien term loan is expected to launch with an original issue discount that is slightly wider than the one that was previously being whispered in the market.

Meanwhile, over in the secondary, CamelBak Inc.'s term loan was a little bit better during Tuesday's market hours from the levels that were seen on the debt when it freed up for trading in the prior session.

Interactive Data timing emerges

Interactive Data firmed up timing on the launch of its proposed $1.46 billion senior secured credit facility (Ba3) as a bank meeting has been scheduled for 12:30 p.m. ET on Wednesday at the Palace Hotel in New York, according to a market source.

Previously, timing on the deal was being labeled as a day-to-day decision, with it unclear as to whether it would come this month or next month.

The facility consists of a $160 million revolver and a $1.3 billion term loan, with price talk not yet available, the source said.

Originally, based on filings with the Securities and Exchange Commission, it was thought that the revolver would be sized at $150 million, but when official details on tranching surfaced, it was said that the revolver would be coming at the larger size of $160 million.

Interactive Data being acquired

Proceeds from Interactive Data's credit facility will be used to help fund the buyout of the company by Silver Lake and Warburg Pincus for $33.86 in cash per share. The transaction has a total value of $3.4 billion.

Bank of America, Barclays Bank, Credit Suisse and UBS Investment Bank are the lead banks on the deal.

Other financing for the buyout will come from $700 million of senior unsecured notes, which are backed by a commitment for a senior unsecured bridge loan, and up to $1.31 billion of equity.

Completion of the transaction is expected to occur by the end of the third quarter, following regulatory approvals and other customary conditions.

Interactive Data is a Bedford, Mass.-based provider of financial market data.

Universal Health sets launch

Also joining this week's calendar is Universal Health Services with a bank meeting slated for Thursday to launch the company's $4.15 billion senior secured credit facility, according to sources.

Based on the commitment letter, the facility is expected to be comprised of an $800 million five-year revolver, a $500 million five-year term loan A and a $2.85 billion six-year term loan B.

However, one source told Prospect News that tranching on the deal is still moving around a bit, with the possibility being that there could be more pro rata debt and less institutional debt.

The commitment letter outlined initial pricing on the revolver and the term loan A at Libor plus 325 basis points, with the spread being able to range from Libor plus 250 bps to 350 bps based on leverage, and pricing on the term loan B at Libor plus 350 bps with a 1.5% Libor floor.

The revolver has an initial commitment fee of 50 bps. This fee can range from 25 bps to 50 bps based on leverage.

Universal Health lead banks

JPMorgan and Deutsche Bank are the joint lead arrangers and bookrunners on Universal Health's credit facility, with JPMorgan the administrative agent. JPMorgan committed 65% of the facility and Deutsche committed the remaining 35%.

Financial covenants include a maximum total leverage ratio and a minimum net interest coverage ratio.

Proceeds will be used to help fund the acquisition of Psychiatric Solutions Inc. for $33.75 per share in cash, or about $2 billion, and, including the assumption of $1.1 billion in Psychiatric Solutions net debt, the total transaction consideration is $3.1 billion.

Pro forma total debt to EBITDA is 3.8 times.

Closing is expected to take place in the fourth quarter, subject to customary conditions, including regulatory approvals and clearance under Hart-Scott-Rodino Act, as well as approval by Psychiatric Solutions' shareholders.

Universal Health revises leverage condition

As was previously reported, Universal Health amended its credit facility commitment letter on June 15 to modify the maximum leverage ratio requirement that is a condition to the financing.

Under the revised letter, the maximum leverage ratio, calculated on a pro forma basis for the transactions for the four most recent fiscal quarters ended not less than 45 days prior to the closing date, is 4.00 to 1.00, provided that the definition of EBITDA will provide for the add-back of certain expenses.

By comparison, under the original commitment, the leverage ratio for the four most-recent fiscal quarters ended not less than 45 days prior to the closing date was set at a maximum of 3.90 to 1.00.

Universal Health is a King of Prussia, Pa.-based owner and operator of acute care hospitals and behavioral health care facilities and schools. Psychiatric Solutions is a Franklin, Tenn.-based operator of owned or leased freestanding psychiatric inpatient facilities.

PSC readies B loan

News surfaced on Tuesday that PSC will be holding a bank meeting on Thursday morning to launch a proposed $175 million six-year term loan B, according to a market source.

Price talk on the term loan B is not yet available.

Proceeds will be used to help fund the buyout of the company by Lindsay Goldberg from Odysseus Holdings and Arrowhead Holdings for a total equity purchase price of $340 million and enterprise value of $331.5 million.

Equity of around 51% will comprise the remainder of the capitalization.

PSC getting revolver

PSC's $240 million credit facility also includes a $65 million five-year revolver, but that tranche has already been syndicated, the source said.

RBC Capital Markets and Jefferies are the joint lead arrangers and bookrunners on the deal.

Ratings on the credit facility are private and have a high single-B profile.

Pro forma for the transaction, LTM ended May 31, total net leverage is 2.8 times.

PSC is a Houston-based provider of hazardous waste management, industrial cleaning, and logistics services.

GEO Group reveals timing

Yet another deal on tap for this week is GEO Group's proposed $750 million credit facility, with Wednesday morning being the time for the bank meeting, according to a market source.

The facility consists of a $400 million five-year revolver talked at Libor plus 275 bps, a $150 million five-year delayed-draw term loan A talked at Libor plus 275 bps, and a $200 million six-year term loan B talked at Libor plus 325 bps with a 1.5% Libor floor and an original issue discount that is still to be determined, the source said.

BNP Paribas is the lead bank on the deal that will be used to refinance existing debt and to help fund the acquisition of Cornell Cos. Inc.

Previously, the company had said that it would get $150 million of additional bank debt for the acquisition through the existing credit facility's accordion feature.

GEO acquisition details

Under the purchase agreement, GEO Group will acquire Cornell at an estimated enterprise value of $685 million, including the assumption of $300 million in Cornell debt and excluding cash.

Cornell stockholders can choose to receive GEO common stock or cash. In order to preserve the tax-deferred treatment of the transaction, no more than 20% of the outstanding shares of Cornell common stock may be exchanged for cash.

The merger is expected to close in the third quarter.

Boca Raton, Fla.-based GEO Group and Houston-based Cornell are prison operators.

SonicWALL tweaks first-lien OID guidance

SonicWALL is anticipated to launch its $155 million first-lien term loan with an original issue discount of 98, not at 98½ as was previously floating around the market, according to a source.

The tranche is still expected to come with talk of Libor plus 500 bps with a 1.75% Libor floor.

The company's $260 million credit facility also includes a $105 million second-lien term loan that is being talked at Libor plus 900 bps with a 1.75% Libor floor and a discount of 98.

Credit Suisse is the lead bank on the deal that is set to launch with a bank meeting on Thursday.

SonicWALL funding buyout

Proceeds from SonicWALL's credit facility will be used to help fund the acquisition of the company by Thoma Bravo LLC and Ontario Teachers' Pension Plan for $11.50 per share in cash. The transaction is valued at about $717 million.

Other funding will come from $280 million of equity and cash on hand.

Closing is expected to take place in the company's fiscal quarter ending Sept. 30 or early in the fiscal quarter ending Dec. 31, subject to regulatory and shareholder approvals.

SonicWALL is a San Jose, Calif.-based provider of IT security and data backup and recovery services.

CamelBak trades up

Moving to the secondary market, CamelBak's $95 million term loan was quoted at 99 bid par offered on Tuesday after breaking for trading on Monday at 98½ bid, 99 offered, according to a market source.

Pricing on the term loan, and a $15 million revolver, is Libor plus 525 bps with a 1.75% Libor floor, and both tranches were sold at an original issue discount of 98

During syndication, pricing on the term loan and the revolver was flexed up from Libor plus 475 bps.

BNP Paribas acted as the lead bank on the $110 million deal that closed on Monday and was used to refinance existing debt.

CamelBak is a Petaluma, Calif., producer of personal hydration systems.

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