TASC overfills ahead of deadline; PODS going well; Pinnacle Foods timeframe emerges

By Sara Rosenberg

New York, Nov. 25 - TASC Inc.'s new credit facility has been seeing very strong demand since launching just a few days ago and PODS Enterprises Inc.'s credit facility has been moving along nicely in terms of syndication and it's expected that the deal will wrap in line with initial terms.

Also on the new deal front, Pinnacle Foods Group LLC revealed that it is expecting to launch its incremental bank debt for the acquisition of Birds Eye Foods Inc. before the end of the year.

TASC fills up

TASC's $690 million senior secured credit facility, which just launched with a bank meeting on Nov. 20, is already oversubscribed as investors have jumped on the deal ahead of the Dec. 2 commitment deadline, according to a market source.

The facility consists of a $100 million revolver, a $200 million term loan A and a $390 million term loan B.

Price talk on the revolver and the term loan A is Libor plus 375 bps, and price talk on the term loan B is Libor plus 400 bps. All tranches carry a 2% Libor floor.

The original issue discount on the revolver is 98, and original issue discount on the term loan A and the term loan B is 981/2.

Initially it was thought that the company would only get a total of $580 million of term loan debt, but the amount was upsized by $10 million prior to launch.

TASC being acquired

Proceeds from TASC's credit facility will be used to help fund the purchase of the company by an investor group led by General Atlantic LLC and Kohlberg Kravis Roberts & Co. from Northrop Grumman Corp. in a transaction valued at $1.65 billion.

Other financing for the buyout will come from $310 million of senior subordinated notes (mezzanine debt) that has been pre-placed. KKR Capital Markets arranged the mezzanine financing and Highbridge Mezzanine Partners is the lead investor.

Barclays Capital, Deutsche Bank Securities and RBC Capital Markets are the lead banks on the credit facility, with Barclays the left lead. In addition, CPPIB Credit Investments Inc. has provided commitments towards the facility as an investor.

Closing on the transaction is expected to take place in the fourth quarter, subject to customary approvals.

TASC is a Chantilly, Va.-based provider of advanced systems engineering and technical assistance to the defense, intelligence, federal, state and local markets.

PODS sees demand

PODS Enterprises' $145 million credit facility has been met with good investor interest and the deal is anticipated to close at the original talk, according to a market source.

The facility consists of a $25 million revolver and a $120 million term loan, with both tranches priced at Libor plus 550 bps with a 2% Libor floor and an original issue discount of 98.

Allocations could go out as early as next week, the source added.

Barclays Capital is the left lead bank on the deal. GE Capital and Golub Capital joined on as bookrunners early in the syndication process.

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

Secured leverage is 2.9 times and total leverage is 4.4 times.

PODS is a Clearwater, Fla.-based provider of moving and storage services.

Pinnacle December business

Pinnacle Food's up to $875 million incremental term loan C is currently anticipated to come to market sometime next month, with an exact date still to be determined, according to a market source.

As previously reported, an 8-K filed with the Securities and Exchange Commission said that the term loan C will be priced at Libor plus 450 basis points, with a 2% Libor floor and an original issue discount of 98.

In addition, the company is getting a $20 million incremental revolver that will be priced in line with the existing revolver.

Maturity dates on the incremental debt will match those of the company's existing debt.

Barclays, Bank of America and Credit Suisse are the joint lead arrangers and bookrunners on the credit facility, with Barclays the left lead. HSBC and Macquarie Capital are bookrunners as well.

Bank of America, Barclays and Credit Suisse have committed to provide 25% of the term loan C, while HSBC committed to provide 15% and Macquarie committed to provide 10%.

Bank of America, Credit Suisse, HSBC and Macquarie each committed to provide $5 million of the revolver.

Pinnacle buying Birds Eye

Proceeds from Pinnacle's term loan C will be used to help fund the acquisition of Birds Eye Foods Inc. from Vestar Capital Partners, Pro-Fac Cooperative and management in a transaction valued at $1.3 billion.

The incremental revolver may only be used for general corporate purposes and working capital.

Pinnacle is also planning to sell $275 million of senior unsecured notes and get $365 million in equity from its sponsor, the Blackstone Group, to fund the acquisition.

The notes are backed by a commitment for a $275 million one-year senior unsecured bridge loan that is priced at Libor plus 600 bps with a 2.5% Libor floor. The spread will increase by 50 bps every three months. Pricing is capped at 12% through Dec. 18 and at 13% thereafter.

The size of the bond offering may be increased if the company is unable to obtain the full $875 million term loan C.

Closing of the transaction is expected to occur no later than the first quarter of 2010, subject to customary conditions, including regulatory approvals.

Pinnacle Foods is a Cherry Hill, N.J.-based manufacturer and distributor of branded packaged foods. Birds Eye is a Rochester, N.Y.-based packaged food company with more than $930 million of total sales.

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