Sedgwick, Aurora, BWAY break; Cedar Fair, Canwest, CamelBak, Spectrum set talk; Calendar builds

By Sara Rosenberg

New York, May 21 - Sedgwick Claims Management Services Inc., Aurora Diagnostics Inc. and BWAY Holding Co. all saw their credit facilities allocate and free up for trading during Friday's market hours.

Meanwhile, over in the primary, Cedar Fair Entertainment Co., Canwest LP and CamelBak Inc. released price talk on their credit facilities as the deals were presented to lenders, and Spectrum Brands Inc. also began circulating talk as it came out with timing on the launch of its credit facility and revealed that its term loan will be larger than initially thought as a result of fewer bonds.

Additionally, Cincinnati Bell Inc., TransUnion and Pabst Brewing Co. piled onto the calendar for the week of May 24, as did Styron and Sophos plc - both of which disclosed some structural details on their credit facilities now that timing has been established.

Regarding all the new launches that have been set, one source explained that people were holding back deals in the primary because the secondary took a tumble the other week and then this past week was sketchy as well. Now, things are somewhat forced to jump on the calendar because of the time crunch created by the upcoming Memorial Day holiday.

Sedgwick Claims frees to trade

Sedgwick Claims Management Services' credit facility hit the secondary market on Friday, with the $400 million six-year first-lien loan (B1/B+) quoted at 99½ bid, par offered, according to traders.

Pricing on the first-lien term loan is Libor plus 400 basis points with a 1.5% Libor floor, and it was sold at an original issue discount of 99.

The company's $660 million credit facility also includes a $60 million five-year revolver (B1/B+) priced at Libor plus 400 bps and a $200 million seven-year second-lien term loan (B3/B-) priced at Libor plus 750 bps, with both of these tranches also carrying a 1.5% Libor floor. The second-lien term loan was sold at an original issue discount of 98½ and is non-callable for two years, then at 103 in year three, 102 in year four and 101 in year five.

During syndication, pricing on the first-lien term loan and the revolver firmed at the wide end of the initial Libor plus 375 bps to 400 bps talk.

Sedgwick Claims being acquired

Proceeds from the credit facility will be used to help fund the buyout of Sedgwick Claims by Stone Point Capital LLC and Hellman & Friedman LLC for $1.1 billion, including repayment of debt.

The company is being acquired from its current group of investors, which includes Fidelity National Financial Inc., Thomas H. Lee Partners LP, Evercore Capital Partners and other minority shareholders.

The transaction is expected to close during the second quarter, subject to usual and customary conditions and the receipt of regulatory approvals.

Bank of America and Barclays Capital are the lead banks on the credit facility.

Sedgwick Claims is a Memphis, Tenn.-based provider of claims and productivity management services to corporate and institutional clients.

Aurora Diagnostics breaks

Aurora Diagnostics' credit facility also broke for trading on Friday, with the $230 million six-year term loan B quoted at 98½ bid, 99 offered, according to traders.

Pricing on the term loan is Libor plus 425 bps with a 2% Libor floor, and it was sold at an original issue discount of 981/2.

The company's $340 million credit facility (B1/B) also includes a $110 million four-year revolver priced at Libor plus 425 bps with a 2% Libor floor as well.

Barclays, Morgan Stanley and UBS are the lead banks on the deal.

Secured leverage is 3.5 times and total leverage is 4.4 times.

Aurora Diagnostics refinancing debt

Proceeds from Aurora Diagnostics' credit facility will be used to refinance existing bank debt, to redeem Aurora Holdings' class Z capital and for acquisitions, for working capital and for general corporate purposes.

Closing on the credit facility is expected to occur before the company completes its proposed initial public offering of class A common stock - the net proceeds of which will be used to acquire Aurora Holdings' units and to increase the company's capitalization and financial flexibility, fund its growth, and also for working capital and general corporate purposes.

Of the total revolver amount, $50 million will be available at the close of the facility and $60 million will be available upon completion of the IPO.

Aurora Diagnostics is a Palm Beach Gardens, Fla.-based diagnostics company.

BWAY starts trading

BWAY Holding 's $490 million term loan freed up for trading on Friday as well, with levels quoted at 99¾ bid, par ¼ offered, according to a market source.

Pricing on the term loan is Libor plus 375 bps with a 1.75% Libor floor, and it was sold at an original issue discount of 99½ - the low end of the initial 99 to 99½ talk.

Deutsche Bank, Bank of America and Barclays are the lead banks on the company's $565 million senior secured credit facility (Ba3/B+), which also includes a $75 million revolver.

Proceeds will be used to help fund the buyout of the Atlanta-based supplier of general line rigid containers by Madison Dearborn Partners LLC for $20 in cash per share. The transaction is valued at roughly $915 million, including the assumption of debt.

Closing is expected to take place in the second or third quarter, subject to shareholder approval, regulatory approvals and other customary conditions.

Michael Foods steady on buyout

Michael Foods Inc.'s term loan B was pretty flat at par bid, par 3/8 offered, versus par bid, par 5/8 offered previously, on news of the acquisition of a majority stake in the company by GS Capital Partners from Thomas H. Lee Partners, according to a trader.

As part of the buyout, the company's existing credit facility will be refinanced, and tender offers will take place for its 9¾% senior discounted notes due 2013 and its 8% senior subordinated notes due 2013.

To help fund the transaction, Michael Foods, a Minnetonka, Minn.-based producer and distributor of food products, has received a commitment for a new credit facility from Bank of America and Goldman Sachs.

The acquisition values the company at $1.7 billion and is expected to close in the next two months, subject to customary conditions.

Cedar Fair talk emerges

Switching to the primary, Cedar Fair Entertainment held a bank meeting on Friday to commence syndication on its proposed $1.35 billion senior secured credit facility (Ba2/BB-), and in connection with the launch, price talk was announced, according to a market source.

The $1.05 billion term loan is being talked at Libor plus 375 basis points with a 1.5% Libor floor and an original issue discount of 99 to 991/2, and the $300 million five-year revolver is being talked at Libor plus 350 bps with no Libor floor.

JPMorgan and UBS are the lead banks on the deal that will be used, along with $500 million of senior unsecured notes, to refinance the company's existing credit facility.

As of March 28, Cedar Fair had $1.5 billion of term loan debt with a final maturity in 2012 and $216 million in borrowings under its revolving credit facility that matures in 2011.

Cedar Fair is a Sandusky, Ohio-based regional amusement-resort operator.

Canwest releases talk

Canwest launched its $400 million term loan on Friday with talk of Libor plus 600 bps with a 2% Libor floor, an original issue discount of 98 and 101 call protection for one year, according to sources.

JPMorgan and Morgan Stanley are the lead banks on the deal that will be used to help fund the acquisition of the company and some of its subsidiaries by holders of its 9¼% senior subordinated notes.

The noteholder group has agreed to buy substantially all of the LP entities' financial and operating assets from Canwest Global Communications Corp., including all of its daily newspapers, digital and online media operations as well as the shares of National Post Inc., for $1.1 billion, including $950 million in cash funding.

Canwest Global is a Winnipeg, Man.-based media company that filed for Chapter 15 bankruptcy on Oct. 6, 2009.

CamelBak provides guidance

Another company to hold a bank meeting on Friday was CamelBak, at which time lenders were told that the $95 million term loan is being talked at Libor plus 475 bps with a 1.75% Libor floor and an original issue discount of 98, according to a market source.

BNP Paribas is the lead bank on the $110 million deal that also includes a $15 million revolver.

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

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

Spectrum Brands reveals timing

Spectrum Brands has scheduled a bank meeting for Monday to launch its proposed $1.3 billion credit facility, which has been upsized from the previously expected $1.05 billion, according to market sources.

The facility now consists of a $300 million ABL revolver and a $1 billion term loan (B2), sources said, whereas before, it was expected that the term loan would be sized at $750 million.

Proceeds will be used to help fund the merger with Russell Hobbs Inc. and to refinance Spectrum Brands' existing senior debt and a portion of Russell Hobbs' existing senior debt.

At the end of the Spectrum Brands' first fiscal 2010 quarter, $1.334 billion was drawn under its senior term loans and roughly $72 million was drawn under its $242 million ABL facility.

Other financing will come from a $500 million senior secured notes offering, which was downsized from its originally expected amount of $750 million in response to the term loan increase.

Credit Suisse, Bank of America and Deutsche Bank are the lead banks on the credit facility.

Spectrum Brands price talk

With the launch fast approaching, Spectrum Brands started floating price talk on its term loan, one source told Prospect News.

The term loan is being talked at Libor plus 450 bps with a 1.5% Libor floor and an original issue discount of 99, the source said.

Following the refinancing of Spectrum Brands' term loan debt and ABL facility, the new combined entity is expected to have a leverage ratio of 3.8 times forecasted adjusted EBITDA for fiscal 2010.

By comparison, Spectrum Brands' leverage ratio at the end of the first fiscal 2010 quarter was 4.7 times.

The combined company, which will operate under the Spectrum Brands name, is expected to deliver about $3 billion in annual revenues with $430 million to $440 million of adjusted EBITDA in fiscal 2010.

Spectrum Brands merger details

Under the merger agreement, current shareholders of Spectrum Brands will receive one share in the new combined company for each share they hold. Furthermore, as part of the transaction, Harbinger has agreed to convert its existing about $158 million of Russell Hobbs' term debt and $207 million of Russell Hobbs' preferred stock into common stock of the new company at a price of $31.50 per share. Following the closing of the transaction, Harbinger is expected to own 63.7% of the combined entity.

The all-stock transaction values Spectrum Brands at an enterprise value of $2.6 billion, or $965 million net of debt, which equates to $31.50 per share net of outstanding debt, and privately held Russell Hobbs at an enterprise value of $675 million, or $661 million net of debt.

The deal is expected to close in June, subject to approval by holders of a majority of Spectrum Brands' common stock not owned by Harbinger, which will be sought at a special meeting on June 11.

Spectrum Brands is an Atlanta-based consumer products company. Russell Hobbs is a Miramar, Fla.-based marketer and distributor of a broad range of branded small household appliances.

Cincinnati Bell readies launch

Also launching with a bank meeting on Monday is Cincinnati Bell's proposed $970 million senior secured credit facility, according to a market source.

The facility consists of a $210 million four-year revolver and a $760 million seven-year term loan, the source said.

No official price talk is available as of yet on the new deal, the source said. However, company officials did say in a recent conference call that the term loan is expected to be priced in the Libor plus 350 bps area, compared to pricing of Libor plus 150 bps on its existing term loan, which will be refinanced in connection with this transaction.

Cincinnati Bell buying CyrusOne

In addition to refinancing a roughly $200 million term loan, Cincinnati Bell's new credit facility will be used to fund the $525 million acquisition of CyrusOne, a data center operator, and for general corporate purposes.

Closing on the transaction is targeted by the end of the second quarter, subject to customary conditions, including regulatory approvals.

Pro forma LTM leverage will be 5.1 times.

Bank of America, Morgan Stanley and Barclays are the lead banks on the credit facility, with Bank of America the left lead.

Cincinnati Bell is a Cincinnati, Ohio-based provider of integrated communications services.

TransUnion retail syndication nears

TransUnion, which has been pre-marketing its $1.19 billion credit facility earlier this month, is now planning on launching the deal into general syndication with a bank meeting on Tuesday, according to a market source.

The facility consists of a $250 million revolver and a $940 million term loan, with price talk not yet available.

Deutsche Bank, Bank of America and JPMorgan are the lead banks on the deal that will be used to help fund Madison Dearborn Partners LLC's acquisition of a 51% interest in the company from the Pritzker family, which is subject to satisfaction of customary conditions and regulatory approvals.

TransUnion is a Chicago-based provider of credit and information management.

Styron eyes $800 million in term loans

Styron is planning to raise $800 million in term loan debt and to get a new revolver, the size of which is to be determined, and this financing will be launched to investors with a bank meeting on Monday, according to sources.

Specifics on the structure of the facility will likely come out at launch, sources said.

Deutsche Bank, Barclays and HSBC are the lead banks on the deal that will be used to help fund the acquisition of the company by Bain Capital from Dow Chemical for $1.63 billion. Dow Chemical has an option to receive up to 15% of the equity of Styron as part of the sale consideration.

The transaction is expected to close by August, subject to completion of customary conditions and regulatory approvals.

Styron is a diversified chemicals and plastics company.

Sophos sets launch, structure

Sophos has scheduled a bank meeting for Tuesday to launch its proposed senior secured credit facility, and now that timing has been set, a structure on the deal emerged as well, according to a market source.

The $320 million facility, which will have dollar and euro components, consists of a $20 million six-year revolver and a $300 million seven-year term loan, the source said, adding that price talk is not yet available.

Leverage is around 3.8 times.

RBC is the lead arranger on the deal that will be used to help fund the buyout of the company by Apax Partners in a transaction valuing Sophos at $830 million.

Sophos is a Boston-based IT security and data protection firm.

Pabst coming Wednesday

Pabst Brewing is set to hold a bank meeting on Wednesday for its new credit facility. Size and structure, however, are not expected to come out until closer to launch, according to a market source.

GE Capital is the lead bank on the deal.

Pabst is a Milwaukee-based brewer.

ViaWest cuts floor

In more primary happenings, ViaWest Inc. lowered the Libor floor on its $140 million credit facility to 1.75% from 2%, while leaving pricing at Libor plus 450 bps, according to sources.

Tranching on the deal is comprised of a $10 million revolver, a $110 million first-lien term loan and a $20 million delayed-draw term loan.

The term loans are being sold at an original issue discount price of 99.

RBC is the lead bank on the deal that will be used to help fund the buyout of the company by Oak Hill Capital Partners from Trinity Equity Investors, Goldman Sachs & Co. and Quilvest.

ViaWest getting second-lien

Other financing for the acquisition of ViaWest will come from a $60 million "silent" second-lien term loan that Oak Hill has already put in place with Barclays Structured Principal Investing Fund LP and Solar Capital Ltd.

The revolver and the delayed-draw term loan are expected to be undrawn at closing.

Completion of the transaction is expected in the second quarter, subject to regulatory approvals and customary closing conditions.

ViaWest is a Denver-based data center and managed services company.

Triumph Group wraps syndication

Triumph Group Inc. shut the books on its $350 million senior secured term loan B (Baa3) as recommitments towards the recently revised deal were due at noon ET on Friday, according to a market source.

The term loan B is priced at Libor plus 300 bps with a step-down to Libor plus 275 bps at less than 2.0 times leverage, a 1.5% Libor floor and an original issue discount of 991/2.

During syndication, the loan was upsized from $300 million, pricing was lowered from Libor plus 325 bps with the addition of the step, and the discount was reduced from the 99 area due to strong demand.

RBC is the lead bank on the deal that will be used to help fund the acquisition of Vought Aircraft Industries Inc. from the Carlyle Group for cash and stock consideration of $1.44 billion, including the retirement of Vought debt. The purchase consideration to Vought shareholders includes about 7.5 million shares and $525 million of cash.

Triumph Group gets revolver

As was already reported, subject to the Vought acquisition closing, Triumph Group entered into an agreement on May 10 for a $535 million revolving credit facility that is led by PNC.

The revolver will be available to partially fund the Vought acquisition and refinance any existing bank debt.

Closing on the acquisition is expected to take place on July 1, subject to normal regulatory approval and Triumph shareholder approval, which will be sought at a special meeting on May 28.

After closing, the acquired business will operate as Triumph Aerostructures-Vought Aircraft Division LLC.

Triumph is a Wayne, Pa.-based designer, engineer, manufacturer and repairer of aircraft components and accessories. Vought is a Dallas-based manufacturer of aerostructures for commercial, military and business jet aircraft.

Jack Henry nets interest

Talk is that syndication of Jack Henry & Associates Inc.'s $300 million credit facility is "going very well so far," a market source told Prospect News.

The facility consists of a $150 million revolver and a $150 million term loan A, with both tranches talked at Libor plus 250 bps.

Wells Fargo and Bank of America are the lead banks on the deal that will be used to help fund the acquisition of iPay Technologies Holding Co. LLC for $300 million.

The acquisition is expected to close in June, subject to regulatory approvals and customary closing conditions.

Jack Henry is a Monett, Mo.-based provider of computer systems and ATM/debit card/ACH transaction processing services. iPay is an Elizabethtown, Ky.-based provider of online bill payment services.

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