CenturyLink, CHG, Blue Buffalo, AES, SeaStar, Cable & Wireless break; Asurion, Focus updated

By Sara Rosenberg

New York, May 19 – In the secondary market on Friday, deals from CenturyLink Inc., CHG Healthcare Services Inc., Blue Buffalo Pet Products Inc., AES Corp. and SeaStar Solutions (Marine Acquisition Corp.) all freed up for trading.

Also, Cable & Wireless Communications plc firmed the spread on its term loan at the high side of guidance and then hit the secondary market, and Dynegy Inc.’s term loan C was stronger with rumors of a possible acquisition by Vistra energy Corp.

In more happenings, Asurion LLC set the issue price on its add-on term loan B-5 at the tight end of talk, and Focus Financial Partners upsized its first-lien term loan.

Additionally, Albertsons Cos. LLC and Berlin Packaging LLC released price talk with launch, and KMG Chemicals Inc. and SuperValu Inc. joined the near-term primary calendar.

CenturyLink frees up

CenturyLink’s $6 billion covenant-light term loan B due January 2025 began trading on Friday, with levels quoted at 99¾ bid, par offered, according to a trader.

Pricing on the term loan B is Libor plus 275 basis points with a 0% Libor floor, and it was sold at an original issue discount of 99.5. The debt has 101 soft call protection for one year and a ticking fee of half the spread from days 31 to 60 and the full spread thereafter.

On Thursday, the term loan B was upsized from $4.5 billion, the spread was trimmed from talk of Libor plus 300 bps to 325 bps, and the call protection was extended from six months.

Bank of America Merrill Lynch, Morgan Stanley Senior Funding Inc., Barclays, Goldman Sachs Bank USA, J.P. Morgan Securities LLC, RBC Capital Markets LLC, MUFG, Wells Fargo Securities LLC, Mizuho Bank and SunTrust Robinson Humphrey Inc. are leading the deal.

CenturyLink funding acquisition

Proceeds from CenturyLink’s term loan B will be used to help fund the acquisition of Level 3 Communications Inc. for $26.50 per share in cash and a fixed exchange ratio of 1.4286 shares of CenturyLink stock for each Level 3 share it owns, which implies a purchase price of $66.50 per Level 3 share. The transaction is valued at about $34 billion, including the assumption of debt.

The extra funds raised through the recent term loan B upsizing will be used to reduce the size of the company’s bridge loan commitment and to refinance Level 3 notes.

At closing, CenturyLink shareholders will own around 51% and Level 3 shareholders will own about 49% of the combined company.

Closing is expected by the end of the third quarter, subject to regulatory approvals and other customary conditions.

CenturyLink is a Monroe, La.-based communications, hosting, cloud and IT services company. Level 3 is a Broomfield, Colo.-based provider of communications services to enterprise, government and carrier customers.

CHG hits secondary

CHG Healthcare Services’ $1,119,400,000 first-lien term loan (B1/B) due June 2023 broke for trading too, with levels seen at par ½ bid, 101 offered, a market source said.

Pricing on the term loan is Libor plus 325 bps with a 1% Libor floor, and it was issued at par. The loan has 101 soft call protection for six months.

On Tuesday, the spread on the loan firmed at the high end of the Libor plus 300 bps to 325 bps talk.

Jefferies Finance LLC is leading the deal that will be used to reprice an existing term loan down from Libor plus 375 bps with a 1% Libor floor.

Closing is expected on June 8.

CHG is a Salt Lake City-based health care staffing firm.

Blue Buffalo tops par

Blue Buffalo’s credit facilities freed up as well, with the $400 million seven-year senior secured term loan B quoted at par ½ bid, 101¼ offered, a trader remarked.

Pricing on the term loan is Libor plus 200 bps with a 25 bps pricing step-down when first-lien gross leverage is less than or equal to 1 time or the company achieves investment-grade corporate and facility ratings and a 0% Libor floor. The loan was issued at par and includes 101 soft call protection for six months.

On Thursday, the spread on the term loan was set at the low end of the Libor plus 200 bps to 225 bps talk, and the issue price was tightened from par.

The company’s $520 million senior secured credit facilities (BB+) also provide for a $120 million revolver.

Citigroup Global Markets Inc. and J.P. Morgan Securities LLC are leading the deal that will be used to refinance existing debt.

Closing is expected during the week of May 22.

Blue Buffalo is a Wilton, Conn.-based pet food company.

AES above OID

AES’ $525 million five-year senior secured covenant-light term loan B (Ba1/BBB-) broke, with levels quoted at par bid, par 5/8 offered, a source said.

The loan is priced at Libor plus 200 bps with a 0.75% Libor floor and was sold at an original issue discount of 99.875. The debt has 101 soft call protection for six months.

During syndication, the discount on the term loan was modified from 99.75.

Barclays, Deutsche Bank Securities Inc., Goldman Sachs Bank USA and Mizuho are leading the deal that will be used to redeem 6.75% convertible trust securities due 2029 and for transaction fees and expenses.

Pro forma senior secured leverage is 0.7 times and total leverage is 4.7 times.

Closing is expected this quarter.

AES is an Arlington, Va.-based power company.

SeaStar begins trading

SeaStar’s fungible $70 million add-on term loan B (B) due January 2021 emerged in the secondary market, with levels seen at par 1/8 bid, par 5/8 offered, according to a trader.

Pricing on the add-on term loan is Libor plus 375 bps with a 1% Libor floor, in line with existing term loan B pricing, and it was issued at par. The debt has 101 soft call protection for six months.

On Thursday, the issue price on the add-on loan was revised from 99.875.

RBC Capital Markets, UBS Investment Bank and Antares Capital are leading the deal that will be used for acquisition financing.

Existing lenders are being given a 12.5 bps amendment fee.

SeaStar is a Litchfield, Ill.-based manufacturer and distributor of marine steering and control systems and engine and drive parts.

Cable & Wireless updated, breaks

Cable & Wireless Communications firmed pricing on its $1,125,000,000 covenant-light term loan B due January 2025 at Libor plus 350 bps, the high end of the Libor plus 325 bps to 350 bps talk, according to a market source.

As before, the term loan has a 0% Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months.

With final terms in place, the term loan freed to trade, with levels seen at 99¾ bid, par 1/8 offered, a trader added.

Bank of America Merrill Lynch, Bank of Nova Scotia, Barclays, BNP Paribas Securities Corp., Citigroup Global Markets Inc. and Goldman Sachs Bank USA are leading the deal that will be used to refinance existing debt.

Cable & Wireless is a London-based telecommunications company owned by Liberty Global.

Dynegy gains

Also in trading, Dynegy’s term loan C moved up to par bid, par ¼ offered, from 99¾ bid, par offered as chatter circulated that the company may be in talks to be purchased by Vistra Energy, a trader remarked.

Dynegy is a Houston-based energy company. Vistra, formerly known as Texas Competitive Electric Holdings Co. LLC, is a Dallas-based power generator and retail electric provider.

Asurion firms price

Back in the primary market, Asurion finalized the issue price on its $1,189,000,000 add-on covenant-light term loan B-5 due 2023 at par, the tight end of the 99.75 to par talk, a market source remarked.

The add-on loan is priced at Libor plus 300 bps with a 0% Libor floor, which matches existing term loan B-5 pricing.

Bank of America Merrill Lynch, Morgan Stanley Senior Funding Inc., Barclays, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and Goldman Sachs Bank USA are leading the deal that will be used to refinance an existing term loan B-2 due 2020.

Asurion is a Nashville-based provider of technology protection services.

Focus tweaks size

Focus Financial Partners lifted its seven-year covenant-light first-lien term loan (Ba3) to $795 million from $755 million and ratably reduced the total equity being used for its buyout, according to a market source.

The first-lien term loan is priced at Libor plus 325 bps with a 0% Libor floor and an original issue discount of 99.875 and has 101 soft call protection for six months.

On Thursday, pricing on the first-lien term loan was cut from talk of Libor plus 350 bps to 375 bps and the discount was revised from 99.5.

Commitments were due at 5 p.m. ET on Friday, with allocations expected on Monday, the source added.

RBC Capital Markets and SunTrust Robinson Humphrey Inc. are leading the deal that will help fund the acquisition of a majority stake in the company by an investor group led by Stone Point Capital and KKR from Centerbridge Partners, Summit Partners and Polaris Partners. The transaction values Focus at about $2 billion.

As part of the financing package, the company is also getting a $207 million privately placed eight-year covenant-light second-lien term loan priced at Libor plus 750 bps with a 0% Libor floor and an original issue discount of 99. This tranche has call protection of 102 in year one and 101 in year two.

Focus is a New York-based partnership of independent, fiduciary wealth-management firms.

Albertsons holds call

Albertsons surfaced in the morning with plans to hold a lender call at 11 a.m. ET to launch $5,749,000,000 in term loans (Ba3/BB), according to a market source.

The debt consists of a $3,014,000,000 term loan B-4 due August 2021 talked at Libor plus 275 bps, a $1,139,000,000 term loan B-5 due December 2022 talked at Libor plus 300 bps and a $1,596,000,000 term loan B-6 due June 2023 talked at Libor plus 300 bps, the source said. All tranches have a 0.75% Libor floor, a par issue price and 101 soft call protection for six months.

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

Credit Suisse Securities (USA) LLC, Bank of America Merrill Lynch, Citigroup Global Markets Inc., Morgan Stanley Senior Funding Inc., Goldman Sachs Bank USA, Deutsche Bank Securities Inc. and Barclays are leading the deal that will be used to reprice an existing term loan B-4, which is being reduced from $3,264,000,000, from Libor plus 300 bps with a 0.75% Libor floor, and to reprice existing B-5 and B-6 loans from Libor plus 325 bps with a 0.75% Libor floor.

Albertsons is a Boise, Idaho-based food and drug retailer.

Berlin releases guidance

Berlin Packaging disclosed talk of Libor plus 300 bps to 325 bps with a 1% Libor floor, a par issue price and 101 soft call protection for six months on its $819,175,000 senior secured covenant-light term loan B (B2/B) due Oct. 1, 2021 that launched with a morning lender call, a market source said.

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

Morgan Stanley Senior Funding Inc. is leading the deal that will be used to reprice an existing term loan B due 2021 from Libor plus 350 bps with a 1% Libor floor.

Berlin Packaging is a Chicago-based hybrid packaging supplier.

KMG timing surfaces

KMG Chemicals came out with timing on the launch of its $550 million seven-year term loan B, with a bank meeting for the debt scheduled to take place at 9:30 a.m. ET on Tuesday, according to an informed source.

The company’s $600 million in senior secured credit facilities also include a $50 million revolver.

KeyBanc Capital Markets Inc., HSBC Bank USA and J.P. Morgan Securities LLC are leading the deal that will be used to fund the acquisition of Flowchem from Arsenal Capital Partners for $495 million, including working capital of about $17 million, to refinance existing debt and for general corporate purposes.

Closing is expected in mid-June, subject to customary conditions, including approval under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

KMG is a Fort Worth, Texas-based producer and distributor of specialty chemicals. Flowchem is a Waller, Texas-based manufacturer of pipeline performance products.

SuperValu on deck

SuperValu set a lender call for 2:30 p.m. ET on Monday to launch an $840 million senior secured term loan B (Ba3), of which $525 million will be funded and $315 million will be delayed-draw, a market source said.

Goldman Sachs Bank USA, RBC Capital Markets, Barclays, Credit Suisse Securities (USA) LLC, BMO Capital Markets and Citigroup Global Markets Inc. are leading the deal that will be used to refinance an existing $524 million senior secured term loan B due 2019 and to help fund the acquisition of Unified Grocers Inc.

Unified Grocers is being bought for $114 million in cash plus the assumption and pay-off of its net debt of about $261 million at closing. The transaction is valued at $375 million.

SuperValu is an Eden Prairie, Minn.-based supermarket operator and wholesale grocery distributor. Unified Grocers is a retailer-owned wholesale grocery cooperative.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.