IMS Health unchanged on IPO news; JLL/Delta sets timing; Dixie, PSAV, SeaStar ready deals

By Sara Rosenberg

New York, Jan. 2 - IMS Health Holdings Inc.'s U.S. term loan held steady in a quiet secondary market on Thursday after the company announced an initial public offering and intentions to refinance some debt.

Over in the primary, JLL/Delta Patheon Holdings LP revealed timing on the launch of its credit facility, and Dixie Electric LLC (FR Dixie Acquisition Corp.), PSAV Presentation Services and SeaStar Solutions emerged with new deal plans.

IMS Health flat

IMS Health's U.S. term loan was quoted at par 3/8 bid, par 7/8 offered in trading on Thursday, in line with previous levels, despite initial public offering news.

One trader remarked that rumors about a possible IPO have been out for a while, making the company's official announcement somewhat expected.

In its S-1 filed with the Securities and Exchange Commission, the company said that it would refinance a portion of its long-term debt in conjunction with its initial public offering of common stock, and that some of the funds for the refinancing will come from the IPO proceeds.

Also, IPO proceeds will be used to pay holders of outstanding phantom options, pay a one-time fee to terminate the company's management services agreement with its sponsors, and for general corporate purposes.

IMS is a Parsippany, N.J.-based provider of information, services and technology for the health care industry.

JLL/Delta Patheon timing

Moving to the primary, JLL/Delta Patheon disclosed timing on its $1.35 billion credit facility, with the bank meeting for the deal scheduled to take place at 10:30 a.m. ET in New York on Jan. 9, a market source said. Previously, timing was labeled as early January business.

The facility consists of a $200 million five-year revolver and a $1.15 billion seven-year term loan B talked with a 1% Libor floor and 101 soft call protection.

Official price talk on the deal has not yet been announced, but in a recent filing with the Securities and Exchange Commission, the company said it expects pricing on both tranches to be Libor plus 425 basis points.

UBS Securities LLC, J.P. Morgan Securities LLC, Jefferies Finance LLC, KeyBanc Capital Markets and Morgan Stanley Senior Funding Inc. are leading the transaction.

JLL/Delta combination

Proceeds from the JLL/Delta Patheon credit facility and $772 million of equity will be used to fund the acquisition of Patheon by JLL Partners and Royal DSM and merger of Patheon with DSM Pharmaceutical Products.

Patheon is being bought for $9.32 per share, implying an equity value of about $1.4 billion and a total enterprise value of $1.95 billion.

Meanwhile, DSM will receive a seller note of $200 million, thereby valuing DSM Pharmaceutical Products at $670 million.

The combined company will be 51% owned by JLL and 49% by DSM.

Closing is expected in the first half of the year, subject to customary conditions.

JLL/Delta Patheon will be a contract development and manufacturing organization for the pharmaceutical industry with anticipated sales of around $2 billion.

Dixie on deck

Dixie Electric set a bank meeting for Wednesday to launch a $310 million credit facility, according to a market source.

The facility consists of a $40 million revolver and a $270 million term loan B, the source said.

UBS Securities LLC, Credit Suisse Securities (USA) LLC, Macquarie Capital and Societe Generale are leading the deal that will be used to help fund the buyout of the company by First Reserve from One Rock Capital Partners LLC.

Dixie is an Odessa, Texas-based provider of electrical infrastructure materials and services to the upstream oil and gas sector.

PSAV readies loan

PSAV Presentation Services will host a bank meeting on Wednesday to launch a $505 million term loan B via lead banks Goldman Sachs Bank USA, Barclays and Morgan Stanley Senior Funding Inc., according to market sources.

Proceeds will be used to help fund the purchase of the company by Goldman Sachs from Kelso & Co.

PSAV is a Long Beach, Calif.-based provider of audio visual equipment and event technology support to the hotel, conference and event industry.

SeaStar coming soon

SeaStar Solutions surfaced with plans to hold a bank meeting on Wednesday to launch a $225 million credit facility, according to a market source.

The facility consists of a $25 million revolver and a $200 million term loan B, the source remarked.

RBC Capital Markets and GE Capital Markets are leading the deal that will be used to help fund the buyout of the company by American Securities.

SeaStar is a manufacturer and distributor of marine steering and control systems and engine and drive parts.

Salix closes

In other news, Salix Pharmaceuticals Ltd. completed its $1.35 billion senior secured credit facility (Ba1/BB) that consists of a $150 million five-year revolver and a $1.2 billion six-year covenant-light term loan B, according to an 8-K filed with the Securities and Exchange Commission.

Pricing on the term loan is Libor plus 325 bps with a step-down to Libor plus 300 bps when leverage is less than 3.75 times. There is a 1% Libor floor and 101 soft call protection for six months, and the debt was issued at an original issue discount of 991/2.

During syndication, pricing on the term loan was reduced from talk of Libor plus 350 bps to 375 bps and the step-down was added.

Jefferies Finance LLC, Fifth Third Securities Inc., PNC Capital Markets LLC, SunTrust Robinson Humphrey Inc. and SMBC led the deal that was used with $750 million of notes and about $800 million of cash on hand to fund the acquisition of Santarus Inc., a San Diego-based specialty biopharmaceutical company, for $32 per share, or about $2.6 billion.

Salix is a Raleigh, N.C.-based developer and marketer of prescription pharmaceutical products and medical devices.

© 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.