Chemours retreats; Everi better bid; Allison Transmission revised; Pacific Dental sets talk

By Sara Rosenberg

New York, Feb. 29 – Chemours Co.’s U.S. term loan weakened in the secondary market on Thursday as the company’s chief executive officer, chief financial officer and principal accounting officer were placed on administrative leave while accounting issues are being reviewed.

Also, in trading, Everi Holdings Inc.’s term loan was bid higher following news that the company will be merging with International Game Technology plc’s Global Gaming and PlayDigital businesses.

Meanwhile, in the primary market, Allison Transmission Inc. tightened the issue price on its term loan B, Pacific Dental Services LLC released price talk on its term loan B with launch, and TK Elevator joined the near-term new issue calendar with plans for U.S. and euro term loans.

Chemours softens

Chemours’ U.S. term loan fell to 98 bid, 99 offered on Thursday from 99½ bid, par ½ offered on Wednesday in reaction to news of management actions and a delay to filing of the company’s form 10-K, according to a trader.

The company announced that its president and chief executive officer Mark Newman, senior vice president and chief financial officer Jonathan Lock and vice president, controller and principal accounting officer Camela Wisel were placed on administrative leave.

The administrative leave is pending the completion of an internal review being overseen by the audit committee of the board of directors with the assistance of independent outside counsel, which scope includes the processes for reviewing reports made to the Chemours ethics hotline, the company’s practices for managing working capital, certain non-GAAP metrics included in filings made with the Securities and Exchange Commission or otherwise publicly released, and related disclosures, a news release said.

As a result, the company is evaluating one or more potential material weaknesses in its internal control over financial reporting as of Dec. 31, 2023.

Chemours 10-K delayed

The company was expected to file its 10-K with the SEC for the for the year ended Dec. 31, 2023 on Thursday.

However, the filing has been delayed to a yet undetermined date since Chemours needs additional time to complete its year-end reporting process, including its review of internal control over financial reporting as of Dec. 31, 2023, and for the audit committee of the board of directors to complete the internal review, the news release explained.

The company did release select unaudited preliminary estimates of operating results and other financial measures as of and for the year ended Dec. 31, 2023, including expected net sales of about $6 billion for the year, versus net sales of $6.8 billion for the year ended Dec. 31, 2022.

Furthermore, the company expects to report a net loss attributable for the year within a range of $225 million to $235 million, compared to net income for 2022 of $578 million.

Chemours is a Wilmington, Del.-based provider of performance chemicals.

Everi bid rises

Everi’s term loan was quoted at par bid, par ¼ offered on Thursday, up on the bid side from 99 7/8 bid, par 3/8 offered on Wednesday, as the company announced plans to merge with International Game Technology plc’s Global Gaming and PlayDigital businesses, a market source remarked.

After closing, Everi will change its name to International Game Technology Inc.

In connection with the transaction, Everi (Ignite Rotate LLC) has received a commitment from Deutsche Bank and Macquarie Capital (USA) Inc. for $3.22 billion of senior secured credit facilities – split between a $500 million five-year revolver and a $2.72 billion seven-year term loan – and a $1 billion senior secured bridge loan that is expected to be replaced with the issuance of senior secured notes or other high-yield debt securities.

The new debt will be used by the gaming and fintech company to fund a $2.6 billion cash payment to International Game Technology plc, about $1 billion will be used to refinance Everi’s existing debt and the remainder will be used to pay the combined company’s financing fees.

Closing is expected in late 2024 or early 2025, subject to regulatory approvals, the approval by Everi stockholders and IGT shareholders, and other customary conditions.

Allison tweaked

Moving to the primary market, Allison Transmission changed the issue price on its $518 million seven-year senior secured covenant-lite term loan B (Baa2) to par from talk in the range of 99.5 to 99.75, according to a market source.

As before, the term loan is priced at SOFR plus 175 basis points with a 0% floor, and has 101 soft call protection for six months.

Recommitments are due at 10:30 a.m. ET on Friday with allocations expected thereafter, the source added.

Citigroup Global Markets Inc. is leading the deal that will be used to amend and extend the company’s existing term loan B. The company will use cash from the balance sheet to reduce the term loan by $100 million from $618 million.

Allison Transmission is an Indianapolis-based automatic transmission company and supplier of hybrid-propulsion systems.

Pacific Dental guidance

Pacific Dental Services held its lender call on Thursday morning and announced price talk on its $1 billion seven-year term loan B (B1/B) at SOFR plus 325 bps to 350 bps with a 0% floor and an original issue discount of 99.5, a market source said.

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

Commitments are due at 5 p.m. ET on March 7.

BNP Paribas Securities Corp. is the left lead and sole bookrunner on the deal, and a joint lead arranger with BMO Capital Markets, BofA Securities Inc., Citigroup Global Markets Inc., JPMorgan Chase Bank, KeyBanc Capital Markets and Goldman Sachs Bank USA. BNP is the administrative agent.

The new loan will be used to refinance existing debt, to pay a $100 million shareholder dividend, to fund an additional $100 million future dividend to the balance sheet, to pay transaction fees and expenses, and for general corporate purposes.

Pacific Dental is an Irvine, Calif.-based provider of business support services to affiliate dental practices.

TK Elevator on deck

TK Elevator set a lender call for 10:30 a.m. ET on Monday and small group meetings for Monday and Tuesday to launch a $2.941 billion term loan B due April 2030 and a €500 million term loan B due April 2030, according to a market source.

The U.S. term loan has a 0.5% floor, the euro term loan has a 0% floor and both loans have 101 soft call protection for six months, the source said.

Commitments are due at 10 a.m. ET on March 11.

Goldman Sachs, Barclays, Credit Agricole, Deutsche Bank Securities Inc. and UBS Investment Bank are the bookrunners on the deal, with Goldman the sole physical bookrunner on the U.S. loan. BofA Securities Inc., Commerzbank, Hessische Landesbank, HSBC, Intesa Sanpaolo, KKR Capital Markets, MUFG, RBC Capital Markets, SMBC, Societe Generale, Standard Chartered, TD Securities and Unicredit are passive bookrunners.

The loans will be used to extend an existing $2.841 billion term loan B due 2027, and refinance existing $600 million and €45 million private senior unsecured notes due 2028.

TK Elevator, owned by Advent and Cinven, is a provider of elevators and escalators.

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