Pharmaceutical Product, Unifrax, B&G Foods, MoneyGram break; Alere add-on loan launches

By Sara Rosenberg

New York, Nov. 18 - Pharmaceutical Product Development Inc. (PPDI) saw its large term loan B emerge in the secondary market on Friday, with levels seen above its original issue discount price, and the new debt for Unifrax I LLC, B&G Foods Inc. and MoneyGram International Inc. began trading as well.

Moving to the primary market, Alere Inc. launched its add-on term loan to investors with a call on Friday morning at previously expected terms, and lenders are being given two weeks to get in their commitments.

PPDI hits secondary

Pharmaceutical Product Development's credit facility broke for trading on Friday, with the $1.45 billion seven-year covenant-light term loan B quoted by one trader at 99½ bid, par offered, and by a second trader at 99¼ bid, par offered.

Pricing on the B loan is Libor plus 500 basis points with a 1.25% Libor floor, and it was sold at an original issue discount of 981/2. There is 101 soft call protection for one year.

During syndication, the term loan B was upsized from $1.325 billion, financial covenants were removed, coupon was trimmed from Libor plus 550 bps and discount tightened from 97.

Prior to its general syndication launch on Nov. 8, the deal was shown to senior managing agents and some institutional lenders in an early round effort. By the bank meeting, there was talk that north of $2 billion of orders came in through early looks and reverse inquiry of accounts wanting to get in the term B.

PPDI getting revolver

Pharmaceutical Product Development's $1.625 billion senior secured facility (Ba3/BB-) also provides for a $175 million revolver.

Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC, Goldman Sachs & Co. and UBS Securities Inc. are leading the deal that will be used to help fund the acquisition of the company by Carlyle Group and Hellman & Friedman for $33.25 per share in an all-cash deal valued at $3.9 billion.

The buyout will also be funded with $575 million of senior unsecured notes that were cut from $700 million as a result of the term loan B upsizing, $1.76 billion of equity and cash on hand.

Closing is expected in the fourth quarter, subject to shareholder approval, which will be sought at a meeting on Nov. 30, and regulatory approval.

Pharmaceutical Product Development is a Wilmington, N.C.-based product development and management services provider to the pharmaceutical research industry.

Unifrax starts trading

Also freeing up was Unifrax's credit facility, with its $385 million seven-year U.S. term loan B quoted at 99 bid, par offered on the break and then levels moved up to 99½ bid, par ½ offered, according to a trader.

Pricing on the U.S. term B is Libor plus 550 bps with a 1.5% Libor floor, and it was sold at a discount of 98. There is 101 soft call protection for one year.

The company's roughly $510 million of B loan debt also includes a €95 million seven-year term loan B that is priced at Euribor plus 600 bps with a 1.5% Libor floor, and was sold at 98 as well. This tranche also includes 101 soft call protection for one year.

Initially, the deal was structured with a single tranche $490 million term B. It was then split into a €75 million euro piece and a $390 million U.S. piece and then revised again to the final amounts. Additionally, pricing on the U.S. loan was lowered from Libor plus 600 bps and the discount tightened from 97.

Unifrax lead banks

Goldman Sachs & Co., Wells Fargo Securities LLC, GE Capital Markets and KeyBanc Capital Markets LLC are the lead banks on Unifrax's roughly $560 million credit facility (B2/B+), which also includes a $50 million five-year revolver.

Pricing on the revolver is Libor plus 525 bps, after flexing down earlier from Libor plus 575 bps, with a 75 bps unused fee. The unused fee will step down to 50 bps at 3.5 times leverage or less.

Proceeds will be used to help fund the buyout of the company by American Securities.

As a result of the increase to the total amount of term loan B borrowings, the equity being used for the transaction was reduced.

Unifrax is a Niagara Falls, N.Y.-based supplier of high-temperature insulation products.

B&G seen atop OID

B&G Foods' credit facility started trading as well on Friday, with the $225 million seven-year term loan B quoted at 99½ bid, par offered before moving up to 99¾ bid, par ¾ offered, according to traders.

Pricing on the term loan B is Libor plus 350 bps with a 1% Libor floor, and it was sold at an original issue discount of 99. There is 101 soft call protection for one year.

The company's $575 million senior secured credit facility (BB) also includes a $200 million five-year revolver and a $150 million five-year term loan A, both priced at Libor plus 300 bps, with the revolver having a 50 bps unused fee and the term loan A offered with a 50 bps upfront fee.

During syndication, the revolver was upsized from $100 million, the term loan A was upsized from $100 million and the term loan B was downsized from $300 million. Also, pricing on the B loan was lowered from Libor plus 400 bps, the floor trimmed from 1.25% and the discount moved from 98.

B&G funding acquisition

Proceeds from B&G Foods' term loans, along with $25 million of revolver borrowings, will be used to fund the purchase of six brands from Unilever United States Inc. for $325 million and refinance the company's existing senior secured credit facility, including a $130 million term loan.

The brands being purchased include Mrs. Dash, Molly McButter, Sugar Twin, Baker's Joy, Static Guard and Kleen Guard.

Closing is targeted for Nov. 30.

Credit Suisse Securities (USA) LLC, Barclays Capital Inc. and RBC Capital Markets LLC are the lead banks on the credit facility.

B&G Foods is a Parsippany, N.J.-based manufacturer, seller and distributor of shelf-stable food.

MoneyGram frees up

MoneyGram International's $150 million incremental term loan B-1 due Nov. 18, 2017 freed up too, with levels quoted at 98½ bid, 99¼ offered on the open and then they moved up to 98 5/8 bid, 99 3/8 offered, according to a trader.

Pricing on the B-1 loan is Libor plus 325 bps with a 1.25% Libor floor, in line with existing term loan pricing, and like the existing loan, there is a step-down to Libor plus 300 bps based on leverage. The paper was sold at an original issue discount of 98 and includes 101 soft call protection for one year.

Meanwhile, the existing term loan due Nov. 18, 2017 moved higher in trading on Friday to 98¾ bid, 99½ offered from 98½ bid, 99¼ offered, because the new paper cleared the market, the trader remarked.

MoneyGram redeeming notes

Proceeds from MoneyGram's term loan B-1, which just launched to lenders this past Thursday, will be used to fund the partial redemption of $175 million of the company's 13¼% senior secured second-lien notes due 2018 held by affiliates of Goldman Sachs & Co. at a price of 113.25%.

Other funds for the transaction will come from cash on hand.

Bank of America Merrill Lynch, Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC and Wells Fargo Securities LLC are the leads on the new debt.

Closing of the new term loan is conditioned on the closing of a proposed recapitalization.

MoneyGram is a Dallas-based payment services company.

Alere comes to market

Switching to the primary, Alere, a Waltham, Mass.-based provider of near-patient diagnosis, monitoring and health management, held a conference call on Friday to launch its $200 million add-on term loan, and set the commitment deadline for 5 p.m. ET on Dec. 2, a market source told Prospect News.

As was previously reported, the add-on term loan is talked at Libor plus 350 bps with a 1% Libor floor, in line with existing term loan B pricing, but is being offered at an original issue discount of 97½ to 98. When obtained at the end of June, the existing B loan was sold at 991/2.

Like the existing loan, the add-on has a leverage-based pricing grid under which spread increases by 25 bps when senior secured leverage is greater than 3.0 times and by an additional 50 bps when it's 4.0 times. This grid is calculated at the end of the fiscal year, which is March 2012.

GE Capital Markets, Jefferies & Co. and Credit Suisse Securities (USA) LLC are leading the deal that will be used to repay $150 million of revolver borrowings and put cash on the balance sheet.

NXP wraps loan

In other news, NXP Semiconductors NV closed on its $500 million senior secured covenant-light term loan A-2 (B2) due 2017 that is priced at Libor plus 425 bps with a 1.25% Libor floor and was sold at an original issue discount of 96, according to a 6-K filed with the Securities and Exchange Commission. The discount came at the tight end of initial guidance of 95 to 96.

The loan is non-callable until March 2013, followed by one year of protection at 102 and another year of protection at 101.

Barclays Capital Inc. and Credit Suisse Securities (USA) LLC led the deal that is being used to refinance a portion of the company's existing secured floating-rate notes.

NXP is an Eindhoven, Netherlands-based provider of mixed-signal products and semiconductor components.

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