Hostess breaks; Univar, Ineos, Columbus McKinnon deal updates emerge; Ensemble sets talk

By Sara Rosenberg

New York, June 21 – Hostess Brands LLC lowered the spread on its term loan B, revised the floor and changed the original issue discount before freeing up for trading on Wednesday.

In more happenings, Univar Solutions Inc. increased the sizes of its U.S. and euro term loans and modified original issue discount guidance, Ineos Enterprises Holdings Ltd. upsized its U.S. and euro term loans and is now offering cashless roll, and Columbus McKinnon Corp. finalized the issue price on its add-on term loan at the tight end of talk.

Furthermore, Ensemble Health Partners released price talk on its incremental term loan B in connection with a lender call, and Dave & Buster’s Inc. joined this week’s new issue calendar.

Hostess flexed, frees

Hostess Brands trimmed pricing on its $985 million seven-year term loan B (B1/BB) to SOFR plus 250 basis points from talk in the range of SOFR plus 275 bps to 300 bps, modified the floor to 0% from 0.5% and adjusted the original issue discount to 99.25 from 98.5, a market source remarked.

As before, the term loan has 101 soft call protection for six months.

The term loan B broke for trading on Wednesday, with levels quoted at 99½ bid, par offered, another source added.

JPMorgan Chase Bank is the left lead on the deal that will be used to refinance an existing term loan B due 2025 and for general corporate purposes.

Hostess is a Lenexa, Kan.-based packaged food company.

Univar revised

Univar Solutions lifted its U.S. seven-year term loan B to about $2.25 billion from $1.75 billion and its euro seven-year term loan B to roughly $850 million euro equivalent from $550 million euro equivalent, changed the original issue discount talk on both loans to a range of 97.5 to 98 from a range of 97 to 97.5, and made some revisions to documentation, according to a market source.

Pricing on the U.S. and euro term loans (B2/B+/BB+) remained at SOFR/Euribor plus 450 bps with a 0% floor, both loans still have 101 soft call protection for six months, and the U.S. term loan still has a ticking fee of half the margin starting on day 46 and the full margin plus three-month SOFR starting on day 91.

Commitments for the U.S. loan continued to be due at 5 p.m. ET on Wednesday, and commitments for the euro term loan are due at 7 a.m. ET on Thursday, the source added. Allocations are expected on Thursday.

Univar leads

JPMorgan Chase Bank, Apollo, BMO Capital Markets, BNP Paribas Securities Corp., Credit Suisse, HSBC Securities, Mizuho, RBC Capital Markets, Wells Fargo Securities LLC, TD Securities and Fifth Third are leading Univar’s loan transaction.

The term loans will be used with about $1 billion of senior secured bonds, downsized from $1.8 billion, and $3.8 billion of equity to fund the buyout of the company by Apollo and minority investor Abu Dhabi Investment Authority for $36.15 per share in cash in a transaction with an enterprise value of about $8.1 billion, and to refinance existing debt.

In addition to the term loans, the company is getting a $1.4 billion asset-based revolver.

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

Univar is a Downers Grover, Ill.-based specialty chemical and ingredient distributor.

Ineos reworked

Ineos Enterprises revised its transaction to a minimum $500 million seven-year senior secured term loan B and a minimum €300 million seven-year senior secured term loan B, from a total €650 million equivalent U.S and euro term loan B, a market source remarked.

Additionally, cashless roll is now formally being offered on the company’s U.S. and euro term loan B’s due 2026, the source continued.

Talk on the U.S. term loan is still SOFR+10 bps CSA plus 400 bps to 425 bps with a 0% floor and an original issue discount of 98 to 98.5, and talk on the euro term loan is still Euribor plus 400 bps to 425 bps with a 0% floor and a discount of 98 to 98.5.

Barclays is the global coordinator on the U.S. loan, and Barclays, MUFG and NatWest are the joint global coordinators and physical bookrunners on the euro loan. ABN Amro, Banco Santander, Fifth Third and JPMorgan are mandated lead arrangers. Barclays is the administrative agent.

The loans will be used to refinance the company’s initial U.S. term loan B, to pay transaction fees and expenses, and for working capital and general corporate purposes, including acquisitions and the repayment of existing debt. The funds from the upsizing will be used to repay existing debt.

Ineos Enterprises is a London-based specialty and commodity chemical producer.

Columbus updated

Columbus McKinnon set the original issue discount on its fungible $75 million add-on term loan due May 2028 at 99.25, the tight end of the 99 to 99.25 talk, a market source said.

Pricing on the add-on term loan is SOFR+CSA plus 275 bps with a 0.5% Libor floor. CSA is ARRC standard of 11.448 bps one-month rate, 26.161 bps three-month rate and 42.826 bps six-month rate.

JPMorgan Chase Bank is leading the deal that will be used to repay revolver borrowings.

Columbus McKinnon is a Getzville, N.Y.-based designer, manufacturer and marketer of intelligent motion solutions for material handling.

Ensemble holds call

Ensemble Health emerged in the morning with plans to hold a lender call at 2 p.m. ET on Wednesday to launch a fungible $297.75 million incremental term loan B due August 2026 talked with an original issue discount of 99.28, according to a market source.

The incremental term loan is priced at SOFR plus 375 bps with a 0% floor, in line with the existing term loan B.

Commitments are due at 3 p.m. ET on Thursday, the source added.

Goldman Sachs Bank USA is leading the deal that will be used to refinance the company’s existing 2022 incremental term loan B, and to pay accrued and unpaid interest thereon and fees and expenses.

Berkshire Partners, Warburg Pincus, Bon Secours Mercy Health and Golden Gate Capital are the sponsors.

Ensemble Health is a Cincinnati-based provider of technology-enabled, end-to-end revenue cycle management services to hospitals and health systems.

Dave & Buster’s on deck

Dave & Buster’s set a lender call for 11:30 a.m. ET on Thursday to launch an $844 million covenant-lite term loan B due June 2029, a market source said.

The term loan has 101 soft call protection for six months.

Commitments are due at 5 p.m. ET on June 28, the source added.

Deutsche Bank Securities Inc. is the left lead on the deal that will be used to refinance an existing $844 million term loan B due June 2029.

Dave & Buster’s is a Coppell, Tex.-based owner and operator of entertainment and dining venues.

Fund flows

In other news, actively managed loan fund flows on Tuesday were negative $51 million and loan ETFs were negative $4 million, market sources remarked.

Actively managed high-yield fund flows on Tuesday were positive $64 million and high-yield ETFs were positive $408 million, sources added.

Loan indices rise

IHS Markit’s iBoxx loan indices were stronger on Tuesday, with the Leveraged Loan indexes (MiLLi) closing out the day up 0.09% and the Liquid Leveraged Loan indices (LLLi) closing out the day up 0.04%.

Month to date, the MiLLi is up 1.56% and year to date it is up 5.52%, and the LLLi is up 1.71% month to date and up 5.61% year to date.

Average secondary market bids in the U.S. on Tuesday were 91.45, up 0.02% from the previous day and down 0.47% year to date.

According to the IHS Markit data, some of the top advancers on Tuesday were Cyxtera’s May 2017 covenant-lite term loan at 49.03, up from 47.28, Trilliant Food’s April 2018 covenant-lite term loan B at 74.5, up from 72.33, and City Brewing’s April 2021 covenant-lite term loan at 52, up from 50.75.

Some top decliners on Tuesday were Lucky Bucks’ July 2021 covenant-lite term loan at 26.6, down from 27.13, Air Methods’ April 2017 covenant-lite term loan B at 36.08, down from 36.67, and Clear Channel’s July 2020 incremental covenant-lite term loan at 85.17, down from 86.5.

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