Ontic term loan frees to trade; Farfetch finalizes spread, widens issue price

By Sara Rosenberg

New York, Sept. 28 – Ontic (Bleriot US Bidco Inc.) finalized the issue price on its incremental first-lien term loan at the wide end of guidance and then the debt made its way into the secondary market on Wednesday.

Also, Generation Bridge II LLC’s incremental term loan was bid around its original issue discount price after freeing up at that level in the prior session.

And, in more happenings, Farfetch US Holdings Inc. firmed the spread on its first-lien term loan B at the high end of talk and revised the original issue discount.

Ontic updated, breaks

Ontic set the original issue discount on its non-fungible $85 million incremental covenant-lite first-lien term loan (B2/B) due October 2026 at 95, the wide end of the 95 to 96 talk, according to a market source.

As before, the incremental term loan is priced at of SOFR+10 basis points CSA plus 450 bps with a 0% floor and has 101 soft call protection for six months.

During the session, the incremental term loan freed to trade, with levels quoted at 95½ bid, 96½ offered, a trader added.

Nomura Securities is the left lead on the deal that will be used to repay revolver borrowings, for general corporate purposes and to pay fees and expenses.

Closing is expected on Friday.

Ontic is a provider of OEM-licensed parts and aftermarket services for mature aerospace and defense platforms.

Generation bid around OID

Generation Bridge’s fungible $45 million incremental senior secured term loan B due February 2029 was bid right around its new issue price on Wednesday morning after breaking for trading at that level on Tuesday, a market source remarked.

The source added that he doesn’t believe much of the debt traded, which is not surprising given the modest tack-on size.

Pricing on the incremental term loan is SOFR+CSA plus 500 bps with a 0.5% floor and it was sold at an original issue discount of 98.56. The debt has 101 soft call protection until February 2023, the same as the existing term loan, and CSA is 11 bps one-month rate, 26 bps three-month rate and 43 bps six-month rate.

During syndication, the incremental term loan was upsized from $32.5 million.

Credit Suisse Securities (USA) LLC is leading the deal that will fund a distribution to equity holders.

With this transaction, pricing on the company’s existing term loan B will convert to SOFR from Libor. The spread is unchanged at 500 bps with a 0.5% floor.

Lenders were offered a 50 bps consent fee.

Generation Bridge is an operator of power generation facilities.

Farfetch tweaked

In other news, Farfetch finalized pricing on its $400 million five-year covenant-lite first-lien term loan B (B1/B-/BB-) at SOFR plus 625 bps, the high end of the SOFR plus 600 bps to 625 bps talk, widened the original issue discount to 93.5 from 95 and made various changes to documentation, a market source said.

The term loan still has a 0.5% floor and is non-callable for one year, then at 103 in year two and par thereafter.

Recommitments were due at 11:15 a.m. ET on Wednesday, the source added.

JPMorgan Chase Bank is leading the deal that will be used for general corporate purposes, working capital and funding of transaction fees and expenses.

Farfetch is a London-based online platform for the luxury fashion industry, connecting creators, curators and consumers.

Loan indices

IHS Markit’s iBoxx Leveraged Loan indices (MiLLi) closed out Tuesday down 0.11% and its Liquid Leveraged Loan indices (LLLi) closed out the day unchanged.

Month to date, the MiLLi is down 1.71% and year to date its down 3.14%. The LLLi is down 2.14% month to date and down 4.51% year to date.

Average secondary market bids in the U.S. on Tuesday were 92.88, down 0.08% from the previous day and 4.1% year to date.

According to the IHS Markit data, some of the top advancers on Tuesday were Genesis Care’s March 2020 U.S. covenant-lite term loan B at 45.75, up from 43.80, Planet Fitness/United PF’s December 2019 covenant-lite term loan at 88, up from 86.33, and Bob’s Discount Furniture’s February 2014 term loan at 91.65, up from 90.

Some top decliners on Tuesday were Domtar Personal Care/Journey Personal Care’s March 2021 term loan at 66.33, down from 68.5, Yak Mat’s June 2018 covenant-lite term loan B at 59.96, down from 61.75, and National CineMedia’s June 2018 term loan B at 63.33, down from 65.

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