Consolidated Communications gains; Action accelerated; New Fortress, Acrisure set talk

By Sara Rosenberg

New York, Oct. 16 – Consolidated Communications Holdings Inc.’s term loan headed higher in the secondary market on Monday as the company announced that it has agreed to be acquired by Searchlight Capital Partners LP and British Columbia Investment Management Corp., and has amended its credit agreement.

Meanwhile, in the primary market, Action Holding BV (Peer Holding III BV/Peer USA LLC) moved up the commitment deadline for its term loan B-4.

Also, New Fortress Energy Inc. (NFE), Acrisure LLC and Kraton Corp. released price talk with launch, and Cetera Financial Group (Aretec Group Inc.), Belfor and SUSE joined the near-term primary calendar.

Consolidated strengthens

Consolidated Communications’ term loan rose in trading on Monday to 89½ bid, 91½ offered, from 87½ bid, 89 offered late last week with the company’s announced purchase by Searchlight Capital Partners LP and British Columbia Investment Management and credit agreement amendment, a market source said.

For the transaction, Searchlight and British Columbia provided $370 million of equity financing commitments.

The company plans to keep its existing capital structure in place following the acquisition.

Searchlight and British Columbia will acquire all of the Consolidated Communications common stock not already owned by Searchlight for $4.70 per share in cash. The transaction has an enterprise value of about $3.1 billion, including the assumption of debt.

In connection with the acquisition agreement, Consolidated Communications amended its credit agreement to increase the maximum consolidated first-lien leverage ratio.

Closing on the buyout is expected by the first quarter of 2025, subject to customary conditions, including receipt of regulatory approvals and shareholder approval.

Consolidated Communications is a Mattoon, Ill.-based broadband and business communications provider.

Action tweaks timing

Switching to the primary market, Action Holding accelerated the commitment deadline for its $1 billion seven-year term loan B-4 (Ba2/BB) to 5 p.m. ET on Wednesday from noon ET on Thursday, according to a market source.

Talk on the term loan is SOFR plus 350 basis points with a 0% floor, an original issue discount of 99 and 101 soft call protection for six months.

Bank of America, Barclays and Deutsche Bank are the left lead global coordinators and lead arrangers, with Bank of America the primary left lead. BNP Paribas, Citigroup, Rabobank and Goldman Sachs are global coordinators and lead arrangers. ABN Amro, Credit Agricole, Natixis, RBC and SMBC are lead arrangers. Rabobank is the administrative agent.

Proceeds will be used with some surplus cash on the balance sheet to fund a financing-related distribution and/or share buyback, to pay transaction fees and expenses, and to put cash on the balance sheet of the group and/or for general corporate purposes.

Action is a non-food discount retailer in Europe.

New Fortress guidance

New Fortress Energy held its lender call on Monday afternoon and announced talk on its $835 million senior secured covenant-lite first-lien term loan B (Ba3/BB/BB-) at SOFR plus 450 bps with a 25 bps step-down upon corporate rating upgrades from two of three agencies, a 0.75% floor, an original issue discount of 96 and 101 soft call protection for six months, a market source remarked.

Commitments are due on Oct. 26, the source added.

Morgan Stanley Senior Funding Inc., MUFG, Natixis, Citigroup Global Markets Inc., HSBC Securities (USA) Inc., JPMorgan Chase Bank, Santander, Wells Fargo Securities LLC and Deutsche Bank Securities Inc. are leading the deal that will be used to repay an existing $400 million 364-day bridge loan and for general corporate purposes, including planned capital expenditures.

New Fortress Energy is a New York-based energy infrastructure company.

Acrisure shops loan

Acrisure held a lender call at 11 a.m. ET, launching a $1 billion seven-year term loan B-5 (B) talked at SOFR plus 450 bps to 475 bps with a 0% floor and an original issue discount of 99, according to a market source.

Commitments are due at 5 p.m. ET on Thursday, the source added.

JPMorgan Chase Bank, BMO Capital Markets, RBC Capital Markets, Truist Securities, Citigroup Global Markets Inc., BofA Securities Inc., TD Securities (USA) LLC, Wells Fargo Securities LLC, Goldman Sachs Bank USA and Mizuho are leading the deal that will be used to refinance an existing term loan B-4 due 2027 priced at SOFR plus 575 bps with a 1% floor.

Acrisure is a Caledonia, Mich.-based insurance brokerage.

Kraton holds call

Kraton emerged in the morning with plans to hold a lender call at 2:30 p.m. ET to launch a non-fungible $300 million incremental covenant-lite term loan B (Ba3) due March 15, 2029 talked at SOFR plus 450 bps with a 0.5% floor, an original issue discount of 97 and 101 soft call protection for six months, a market source said.

Commitments are due at noon ET on Oct. 25, the source added.

Wells Fargo Securities LLC is the left lead on the deal that will be used to pay down an existing ABL facility due 2027 and to partially repay a euro term loan B due 2029.

Kraton is a Houston-based producer of specialty polymers and high-value bio-based products derived from pine wood pulping co-products.

Cetera on deck

Cetera Financial set a bank meeting for 11 a.m. ET on Tuesday to launch a fungible $1.689 billion incremental first-lien term loan due August 2030 and a $300 million five-year revolver, according to a market source.

The incremental term loan and the existing 2030 term loan are getting 101 soft call protection for six months.

Commitments are due at noon ET on Oct. 26, the source added.

UBS Securities LLC, Goldman Sachs Bank USA, BMO Capital Markets Corp., Deutsche Bank Securities Inc., Truist Securities Inc., Jefferies LLC, Morgan Stanley Senior Funding Inc., Barclays and Antares Capital are leading the deal (B).

Cetera buying Avantax

Centera will use the new bank debt with $700 million of other secured debt to fund the acquisition of Avantax Inc. for $26.00 in cash per share in a transaction valued at about $1.2 billion, inclusive of Avantax’s net debt, and to refinance its existing first-lien term loan due 2025.

With the acquisition, Genstar and co-investors will be reinvesting in Cetera with new and rollover equity.

Pro forma for the transaction, the first-lien term loan will total around $2.439 billion.

Pricing on the existing 2030 first-lien term loan is SOFR+CSA plus 450 bps with a 0% floor. CSA is 10 bps one-month rate, 15 bps three-month rate and 25 bps six-month rate.

Closing is expected by the end of this year, subject to stockholder approval, regulatory approvals and other customary conditions.

Cetera is a San Diego-based investment advisor network, providing wealth management services through a network of independently managed firms. Avantax is a Dallas-based provider of tax-focused financial planning and wealth management.

Belfor readies deal

Belfor will hold a lender call at 10:30 a.m. ET on Tuesday to launch a $1.235 billion term loan B due 2030 and a €250 million term loan B due 2030, a market source remarked.

Talk on the U.S. term loan is SOFR plus 375 bps to 400 bps with a 0.5% floor and an original issue discount of 99, and talk on the euro term loan is Euribor plus 400 bps to 425 bps with a 0% floor and a discount of 99, the source said. Both loans have 101 soft call protection for six months.

Commitments are due at 5 p.m. ET on Oct. 24 for the U.S. loan and at noon ET on Oct. 24 for the euro loan, the source added.

JPMorgan Chase Bank is the left lead on the deal that will be used to refinance an existing $783 million first-lien term loan B due 2026 and a $654 million incremental first-lien term loan B due 2026, to repay revolver borrowings and for general corporate purposes.

Belfor is a Birmingham, Mich.-based disaster recovery and property restoration company.

SUSE coming soon

SUSE scheduled a lender call for 10 a.m. ET on Tuesday to launch a $1.255 billion equivalent U.S. and euro seven-year covenant-lite term loan B, according to a market source.

The term loan debt has 101 soft call protection for six months.

Commitments are due at 10 a.m. ET on Oct. 26, the source added.

Goldman Sachs, BofA Securities Inc., Deutsche Bank and JPMorgan are the physical bookrunners on the deal. HSBC and Jefferies are joint bookrunners. JPMorgan is the administrative agent.

The term loan debt will be used to fund the tender offer for the company’s shares by EQT, to repay existing debt under the OpCo SFA and 2020 sidecar facilities agreement, and to amend and extend existing debt facilities.

SUSE is a Nuremberg, Germany-based provider of open source infrastructure software for large enterprises.

Fund flows

In other news, actively managed loan fund flows on Friday were negative $25 million and loan ETFs were positive $7 million, sources said.

Outflows for loan funds in 2023 total negative $19 billion, with positive $287 million ETFs, sources added.

Loan indices rise

IHS Markit’s iBoxx loan indices were stronger on Friday, with the Leveraged Loan indexes (MiLLi) closing out the day up 0.04% and the Liquid Leveraged Loan indices (LLLi) closing out the day up 0.05%.

Month to date, the MiLLi is up 0.1% and year to date it is up 9.94%, and the LLLi is up 0.13% month to date and up 9.21% year to date.

Average secondary market bids in the U.S. on Friday were 93.02, up 0.05% from the previous day and up 1.25% year to date.

According to the IHS Markit data, some of the top advancers on Friday were EyeCare Partners’ February 2020 covenant-lite term loan B at 67.67, up from 64.83, Sound Physicians’ June 2018 term loan at 29.08, up from 28.4, and Audio Visual Services’ February 2018 second-lien covenant-lite term loan at 90, up from 88.5.

Some top decliners on Friday were Endo Pharmaceuticals’ March 2021 covenant-lite RSA term loan B at 66.75, down from 70.25, Research Now/Survey Sampling’s December 2017 second-lien covenant-lite term loan B at 43.71, down from 45.67, and Air Methods’ April 2017 covenant-lite term loan B at 28.56, down from 29.14.

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