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Camping World sets lender call for repricing, $95M add-on loan

Goldman Sachs is holding a lender call on Monday to launch a repricing and $95 million add-on term loan for Camping World, sources said. Proceeds of the add-on would fund a dividend.

Good Sam Enterprises, formerly known as Affinity Group, is a provider of membership clubs, as well as subscription-based products, services, and publications, targeted toward recreational vehicle and other outdoor enthusiasts in the U.S.

Additionally, the company owns Camping World, the nation’s largest retailer of RV supplies, accessories, services, and new and used RVs. The company is 97% owned by private equity investor Stephen Adams. – Staff reports

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Presidio sets talk as $600M dividend recap leveraged loan launches

Barclays, Morgan Stanley, PNC, and SunTrust Robinson Humphrey today launched their dividend recapitalization for Presidio, setting price talk of L+375-400, with a 1% LIBOR floor on the $600 million term loan.

Arrangers are asking holders of the current $380 million term loan due March 31, 2017 to roll their commitments into the upsized deal at lower pricing. Rollover commitments would be at par, while new money commitments are at 99-99.5, sources said.

The maturity won’t change, and the deal will continue to be governed by net-total-leverage and interest-coverage tests. As before, annual amortization will kick up from 1% to 5% on Dec. 31, 2014, sources noted. The loan will include six months of 101 soft call protection.

Presidio, a provider of advanced-technology infrastructure products and services, is looking to pay a $215 million dividend to sponsor American Securities, which bought the company in 2011. The original equity check was $230 million, sources noted. The transaction would releverage Presidio to 3.67x, and 3.48x on a net basis. The 2011 LBO leveraged the issuer at 3.8x.

Commitments are due on March 18.

PNC is administrative agent on the loan, sources noted.

Presidio in August 2012 placed a $385 million term loan at L+450, with a 1.25% LIBOR floor.

The issue is currently rated B+/B1, with current loan ratings at B+/Ba3. – Chris Donnelly

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Waste Industries outlines price talk as recap leveraged loan launches

Bank of America Merrill Lynch, Macquarie, Credit Suisse, and SunTrust Robinson Humphrey today launched syndication of the $700 million covenant-lite B term loan for Waste Industries, setting price talk of L+350-375, with a 1% LIBOR floor and a 99 offer price, according to sources. The five-year loan would carry six months of 101 soft call protection.

At the proposed guidance, the loan offers a yield to maturity of about 4.82-5.08%.

Proceeds will be used to refinance the borrower’s existing credit facilities and its industrial revenue bonds as well as to redeem its $17 million of Class A equity units, pay a $10 million dividend to Class B shareholders, and place $10 million of cash on the balance sheet. Though Macquarie Infrastructure Partners owns a controlling stake in the company, the Class A and Class B shares are owned by the members of the founding Poole family, sources noted.

Commitments on the loan are due on Wednesday, Feb. 18.

Following a one-notch upgrade from S&P earlier this week, corporate ratings are BB-/B1. The loan is also rated BB-/B1, with a 3 recovery rating from S&P.

The issuer is also putting in place a $250 million revolver alongside the TLB, according to S&P.

The deal includes a $155 million free-and-clear incremental tranche, with additional borrowings subject to a 4.5x net first-lien leverage test, sources said.

The waste-management company last tapped the market in February 2013 via BAML for a repricing and $100 million upsizing of its B term loan, which increased the tranche to $515 million. The loan, which matures in March 2017, cleared the market at L+300, with a 1% LIBOR floor, and was issued at par. Note the existing deal is governed by leverage and interest-coverage covenants. The company also has in place a $325 million revolver maturing in 2016.

Waste Industries provides non-hazardous solid-waste collection, transfer, recycling, and disposal services. Its operations are concentrated in the Southeastern U.S. – Kerry Kantin

 

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YouTube: June 2014 US leveraged loan market analysis (plus slides)

LCD’s video analysis detailing the US leveraged loan market during May is now on YouTube.

Loan prices rebounded during the month after April’s mini correction, a result of strong CLO issuance and slowing volume.

Looking to the summer, most players think the market will remain largely CLO-driven, with retail a slight drag on demand. Loan supply, meanwhile, is roundly expected to be lackluster. Though the M&A loan calendar remains within the recent range, some transactions are not expected to launch until the fall, and there are few blockbuster executions in the mix.

This month LCD looks at:

  • Average Bid of S&P/LSTA Loan Index
  • S&P/LSTA Index Loans Outstanding
  • Visible inflows
  • Average New-Issue Clearing Yields of First-Lien Loans
  • Loan Default Rate
  • M&A Institutional Loan Forward Calendar

The video is available here.

The URL:

Click here to download PDF slides of the video on Slideshare.

While you’re on YouTube please subscribe to LCD’s YouTube Channel. That way you’ll be certain not to miss any LCD videos. You can also subscribe by clicking on the link to the right of any LCD News email, or here:

http://www.youtube.com/user/LCDcomps

If you’d like to embed any LCD video on a web page or in other digital media, it’s simple via the “embed” button on the YouTube page for the video. You can also embed the slides via Slideshare.

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Despite cooler leveraged loan mart, dividend volume hits recent high in April

leveraged loan dividends

The leveraged loan market may have cooled in April, but dividends remained hot. Indeed, issuers inked $7.9 billion of new recap-related loans during the month, up from $7.5 billion in March. April’s loan dividend total was the highest since May 2013, even as overall leveraged loan volume downshifted to $52.5 billion, from $64.8 billion in March.

You can read more about how leveraged loan dividends work here, in LCD’s Online Loan Market Primer.

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Rocket Software withdraws recap loan due to choppy market conditions

Rocket Software today withdrew its proposed dividend recapitalization financing, according to sources.

The issuer elected to withdraw the transaction due to recent choppy market conditions, sources said. Rocket Software is the third opportunistic deal withdrawn from the market this month. On Friday, Booz Allen Hamilton cancelled a proposed refinancing of its TLB, while early in the month WideOpenWest pulled a proposed repricing of its term loans.

Jefferies earlier this month launched a covenant-lite deal that was split between a $550 million six-year first-lien term loan and a $175 million, seven-year second-lien term loan, proceeds of which would have been used to refinance existing debt and fund a dividend to Court Square Capital Partners and management. Via the transaction, the issuer would have also reduced pricing on both term loan tranches.

The first-lien had been talked at L+375, with a 1% LIBOR floor, offered at 99.5, while guidance on the second-lien was L+725, with a 1% floor, offered at 99.

A late 2012 add-on took Rocket’s first-lien term loan due February 2018 to roughly $357 million. The loan is priced at L+450, with a 1.25% LIBOR floor. The issuer also has in place a $105 million second-lien term loan stemming from an early 2012 transaction that backed a $260 million dividend, sources noted. The second-lien is priced at L+875, with a 1.5% floor.

Rocket Software is a global provider of enterprise-infrastructure software. The firm is engaged in business and technology partnerships with IBM, EMC, Fujitsu, HP Enterprise Services, Datatel, Avaya, Motorola, and others. The issuer has 83% revenue visibility and renewal rates of 95%, sources noted. – Kerry Kantin

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Presidio (Sponsor: American Securities) sets $600M leveraged loan for dividend recap

presidioBarclays, Morgan Stanley, PNC, and SunTrust Robinson Humphrey are launching a dividend recapitalization for Presidio with a bank meeting on Tuesday, March 4, at 10:00 a.m. EST. Presidio, a provider of advanced-technology infrastructure solutions, is seeking a $600 million B term loan due March 31, 2017.

Proceeds will be used to refinance existing debt, fund a one-time distribution to shareholders, and pay related fees and expenses. PNC is administrative agent on the loan, sources noted.

Presidio in August 2012 placed a $385 million term loan at L+450, with a 1.25% LIBOR floor. Amortization on the existing loan, currently 1%, is poised to kick up to 5% later this year. The deal includes a total leverage test.

Sponsor American Securities contributed $230 million of equity in the 2011 LBO, a transaction that leveraged Presidio at roughly 3.8x, all senior, according to sources.

The issue is currently rated B+/B1, with current loan ratings at B+/Ba3. – Chris Donnelly

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Asurion outlines price talk as $2.25B recap leveraged loan launches

Bank of America Merrill Lynch, Morgan Stanley, Barclays, Credit Suisse, Deutsche Bank, and Goldman this morning launched their mix of add-on and new covenant-lite first- and second-lien loans for Asurion.

Proceeds will be used to refinance the company’s holdco debt and fund a distribution to shareholders and option holders, sources said. The issuer appears to be raising more than $1.2 billion of incremental debt.

Asurion is planning a $300 million fungible add-on to its TLB-1 due May 24, 2019, talked at L+375, with a 1.25% LIBOR floor, and offered at 99-99.5, along with a new non-amortizing $250 million, three-year TLB-3 that is talked at L+300, with a 0.75% LIBOR floor, and offered at 99.5. All the new and existing first-lien loans will now include 12 months of 101 soft call protection.

The new $1.7 billion, seven-year second-lien term loan is talked at L+750-800, with a 1% LIBOR floor, offered at 98, sources said. The loan will be non-callable for one year, followed by 103 and 101 call premiums in years 2-3, respectively.

Asurion will amend alongside the new loans, increasing pricing on both its B-1 and B-2 loans and including a 50 bps amendment fee.

Pricing on the $3.9 billion covenant-lite B-1 term loan due May 2019 would increase to L+375, with a 1.25% LIBOR, from L+325, with a 1.25% LIBOR floor and a 101 soft call premium that runs through Feb. 22, 2014.

The roughly $850 million B-2 term loan due July 8, 2020, currently priced at L+275, with a 0.75% LIBOR floor would increase to L+350, with a 0.75% LIBOR floor.

New money commitments and amendment consents are due at noon EST on Wednesday, Feb. 26.

At current talk, yields would be as follows:

  • The new money TLB-1 would yield 5.21-5.33% to maturity; including the fee, the amended TLB-1 would yield 5.21%;
  • The amended TLB-2 would yield 4.41% to maturity;
  • The new TLB-3 would yield 3.99% to maturity;
  • The new second-lien term loan would yield 9.19-9.73%.

The current $1 billion unsecured term loan sits at Lonestar Intermediate Super Holdings LLC. The 7.5-year, covenant-lite loan is priced at L+950, with a 1.5% LIBOR floor. It is non-callable for two years and then callable at 102 and 101 in years three and four, respectively.

Asurion, which provides protection services for the wireless industry, is controlled by Madison Dearborn, Berkshire Partners. Providence Equity Partners, and Welsh, Carson, Anderson & Stowe. – Chris Donnelly

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Leveraged Loan Volume Rebounded Last Week to $8.3B Though Activity Remained Tepid

weekly leveraged loan volume

Leveraged loan volume in the U.S. totaled $8.3 billion last week, up sharply from the $3.5 billion the previous week, though volume overall remains unimpressive.

The largest deal to launch was a $1.68 billion credit backing CACI International’s acquisition of Six3 Systems. Both companies provided information solutions and services in support of national security missions and government transformation for intelligence, defense, and federal civilian customers.

Of interest last week, private equity concerns Carlyle and Stone Point launched a $135 million term for financial advisory concern Duff & Phelps backing, among other things, a dividend to the sponsors. As well, the loan was covenant-lite, meaning it has fewer restrictions than seen on traditional loans. (You can read more about how covenant-lite loans work here.) Despite the looser structure and dividend purpose, the credit saw appetite enough in the institutional investor market that the fee on offer to join the deal was trimmed during syndication, according to LCD’s Chris Donnelly and Kerry Kantin.

Of the 16 deals officially launching during the week (through yesterday), five were covenant-lite while eight arrived courtesy private equity sponsors (including Duff & Phelps).

With last week’s activity, year-to-date leveraged loan volume totals $508 billion, easily outpacing the full-year 2012 total of $465 billion. The full-year record is $535 billion in 2007. These volume numbers entail “new-money” deals, as opposed to credits that simply reset existing tranches of add-on loans, amendments and restatements.

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Duff & Phelps’ (Carlyle Group, Stone Point) $135M add-on loan enters trading above issue price

duff-and-phelpsThe $135 million add-on term loan for Duff & Phelps broke for trading this afternoon at 99.875/100.375, versus issuance at 99.5, according to sources. The covenant-lite loan due April 2020 is priced at L+350, with a 1% LIBOR floor and includes six months of 101 soft call protection. Credit Suisse, Barclays, RBC Capital Markets, and Goldman Sachs arranged the transaction. The issuer, which was acquired earlier this year by an investor group led by The Carlyle Group and Stone Point, plans to use proceeds to repurchase a portion of a tax-receivable agreement and fund a shareholder dividend. There’s also an amendment alongside the capital raise, which pays a 10 bps fee. The amendment will refresh the incremental tranche at its original level, permit the dividend, reset call protection, and delay the excess cash flow sweep until 2014, sources said. The issuer’s existing $349 million term loan, the proceeds of which backed the leveraged buyout of the company, was syndicated in March via Credit Suisse, Barclays, and RBC Capital Markets. The seven-year loan cleared the market at L+350, with a 1% LIBOR floor, and was issued at 99.75. The financing package also included a $75 million, five-year revolving credit with a springing covenant. Duff & Phelps is a New York City-based provider of independent financial advisory and investment banking services. Terms:

Borrower Duff & Phelps
Issue $135 million add-on term loan
UoP Repurchase a portion of a tax-receivable agreement, fund shareholder dividend
Spread L+350
LIBOR floor 1.00%
Price 99.50%
Tenor/maturity April, 2020
YTM 4.67%
Call protection six months 101 soft call
Corporate ratings B/B2
Facility ratings B/B2
S&P recovery rating 3
Financial covenants none
Arrangers/bookrunners CS, Barclays, RBC, GS
Admin agent CS
Sponsor Carlyle Group, Stone Point