Atlas Pipeline, Weekley Homes price; Weekley gains; Chiquita slates; Beazer, Sabine deals await

By Paul Deckelman and Paul A. Harris

New York, Jan. 28 - Weekley Homes, LLC priced $200 million of 6% notes due 2023 as a scheduled forward-calendar offering on Monday. The builder's new bonds were seen by traders to have gained more than 2 points in the aftermarket.

High-yield syndicate sources also reported that Atlas Pipeline Partners, LP came to market with a quickly shopped 10.5-year transaction, which was upsized to $650 million. The midstream natural gas operator's new deal arrived too late in the session for any kind of secondary dealings.

In fact, those two sectors - home building and energy - accounted for most of the primary sphere activity in the domestic dollar-denominated market.

Besides the Weekley pricing, the forward calendar saw two new homebuilder deals: Beazer Homes USA, Inc., which is expected to price a $200 million 10-year deal on Tuesday, and Ashton Woods USA LLC, which began a roadshow on Monday for its $250 million eight-year deal expected to price on Friday.

Back among the energy names, Talos Production LLC hit the road on Monday with a $300 million five-year deal, which is expected to price at the end of the week. Meanwhile, price talk emerged on Sabine Pass Liquefaction LLC's $1 billion eight-year secured deal, which is expected to price on Tuesday.

Away from energy and homebuilding, talk was out on Orion Engineered Carbons Finance's $390 million PIK toggle notes deal and on Macau casino company Melco Crown Entertainment $1 billion deal, which are both expected to price on Friday.

Banana giant Chiquita Brands International, Inc. announced a new $425 million eight-year secured deal, expected to price on Wednesday.

In the euro-note market, another gaming operator, Spain's Cirsa Funding Luxembourg SA, was shopping a smallish add-on deal around for likely pricing on Tuesday.

Traders said the most of the secondary market's focus was on new or recently priced bonds.

Statistical market performance indicators eased, in contrast to Friday's across-the-board gains.

Atlas Pipeline drive-by

News volume was intense as the January-February crossover week got under way.

Two high-yield issuers, each packing a single-tranche deal, raised $850 million.

Atlas Pipeline Partners and Atlas Pipeline Finance Corp. priced an upsized $650 million issue of 10.5-year senior notes (B2/B+) at par to yield 5 7/8%, on top of yield talk.

Bank of America Merrill Lynch, Wells Fargo, Deutsche Bank, Citigroup and J.P. Morgan were the joint bookrunners for the quick-to-market debt refinancing deal, which was upsized from $450 million.

Weekley at the tight end

David Weekley Homes priced a $200 million issue of 10-year senior notes (B2/BB-) at par to yield 6%, at the tight end of the 6% to 6¼% yield talk.

Credit Suisse, Merrill Lynch and Wells Fargo were the joint bookrunners.

The Houston-base homebuilder plans to use the proceeds to repay its revolving credit facility borrowings fund general corporate purposes

Mohawk split-rated deal

In the crossover market, Mohawk Industries, Inc. priced an upsized $600 million issue of 3.85% 10-year senior notes (Ba1/BBB-/BBB-) at 187.5 basis points over Treasuries.

Guidance was revised twice more to the 200 bps to 212.5 bps range and then to the 200 bps area, plus or minus 12.5 bps, and the bonds came tight to that final talk.

The deal, which was upsized from $500 million, played to a $4 billion order book, according to a market source.

Barclays, Merrill Lynch and J.P. Morgan were active bookrunners. Passives were SunTrust and Wells Fargo Securities LLC.

Proceeds, along with cash on hand and borrowings under a senior credit facility, are being used to retire substantially all of the debt of Marazzi Group and to pay the cash portion of the $1.5 billion purchase price and transaction expenses incurred in connection with the acquisition of that company.

Melco talks $1 billion

Dealers set the stage for a busy Tuesday session.

MCE Finance Ltd., a subsidiary of Macau's Melco Crown Entertainment, talked its $1 billion offering of eight-year senior notes (expected ratings B1/BB-) with a yield in the 5¼% area on Monday.

The quick-to-market deal is expected to price on Tuesday.

Deutsche Bank, ANZ, Merrill Lynch and Citigroup are the joint bookrunners for the debt refinancing.

Orion talks PIK toggles

Orion Engineered talked its $390 million offering of six-year PIK toggle notes (confirmed Caa1/expected CCC+) to yield 9½% to 9¾%.

The deal is set to price on Tuesday.

Goldman Sachs is the physical bookrunner. Barclays, JPMorgan and UBS are the joint bookrunners.

Proceeds will be used to fund a distribution to shareholders.

Beazer Homes 10-year deal

Beazer Homes plans to host an investor call at 10 a.m. ET on Tuesday in order to discuss its $200 million offering of 10-year senior notes.

The deal is set to price on Tuesday afternoon.

Credit Suisse is the bookrunner for the debt refinancing.

Also on Tuesday, Sabine Pass Liquefaction, a subsidiary of Cheniere Energy Partners, LP, is expected to price its $1 billion offering of non-callable eight-year senior secured notes (Ba3/BB+).

The deal was talked with a yield in the 5 5/8% area on Friday.

Morgan Stanley, Credit Suisse, RBC, Deutsche Bank, SG, Standard Chartered, HSBC, J.P. Morgan, Mitsubishi and Credit Agricole are the joint bookrunners.

Cirsa to tap 8¾% notes

In the European market, Spanish gaming firm Cirsa Funding Luxembourg plans to price a €100 million add-on to its 8¾% senior notes due May 15, 2018 (existing ratings B3/B+/) on Tuesday.

Deutsche Bank is the bookrunner.

The Madrid-based company plans to use the proceeds to refinance debt and for general corporate purposes.

The original €400 million issue priced at 97.8926 to yield 9 1/8% in April 2010.

Chiquita brings secured deal

Chiquita Brands International and Chiquita Brands, LLC plan to price a $425 million offering of eight-year senior secured notes on Wednesday.

Merrill Lynch, Wells Fargo, Goldman Sachs and Barclays are the joint bookrunners for the debt refinancing deal.

Talos five-year deal

Talos Production LLC and Talos Production Finance Inc. began a roadshow on Monday for their $300 million offering of five-year senior notes (expected ratings Caa1/CCC+).

The roadshow wraps up on Friday, and the deal is expected to price by the end of the present week.

Citigroup is the left bookrunner for the acquisition financing deal. Goldman Sachs, Nomura and TD are the joint bookrunners.

Ashton Woods starts roadshow

Ashton Woods USA and Ashton Woods Finance Co. started a roadshow on Monday for their $250 million offering of eight-year senior notes (expected ratings Caa1/B-).

The deal is expected to price on Friday.

J.P. Morgan and Wells Fargo are the joint bookrunners.

Proceeds, together with an equity contribution from the owner, will be used to redeem the company's existing 11% senior subordinated notes due 2015 and its 9½% senior subordinated notes due 2015, as well as to repay its existing second-lien facility and revolver and for general corporate purposes.

Weekley anything but weak

When Weekley Homes' 6% notes due 2023 were freed in the secondary market, a trader saw the issue get as good as 102¾ bid, before coming off that peak level to go home at 102¼ bid, 102½ offered.

A second trader saw the Houston-based homebuilder's bonds at 102¼ bid, 102¾ offered - up from the par level at which the $200 million transaction had priced.

Traders said the day's other pricing - from Pittsburgh-based midstream natural gas concern Atlas Pipeline Partners - arrived too late in the session for any immediate aftermarket dealings.

Friday deals a mixed bag

Looking at the bonds that came to market on Friday, a trader said that Apex Tool Group LLC's 7% notes due 2021 "continued to move up," pegging that paper around 104 bid.

A second trader saw two-sided markets straddling that price, at 103¾ bid, 104¼ offered.

Yet another trader quoted them higher by half a point at 104 bid, 104½ offered.

The Sparks, Md.-based tool manufacturer, along with BC Mountain Finance Inc., priced $450 million of the bonds on Friday in a scheduled forward-calendar deal. The new notes quickly moved above the 103 mark in initial aftermarket dealings.

While Apex was improving, Digital Globe Inc.'s 5¼% notes due 2021 "were fading," the first trader said, seeing them offered at 101 and going out at 100½ bid, 101 offered. That was in contrast to levels around 101¾ bid, 102 offered seen after the bonds had priced off the calendar.

A second trader, though, located the bonds at 101 1/8 bid, 101 5/8 offered, calling them down just 1/8 from Friday's initial aftermarket levels.

The Longmont, Colo.-based provider of satellite imagery priced $600 million of the notes at par, after having upsized its deal from $500 million originally.

A trader saw Friday's other deal - WEX Inc.'s 4¾% notes due 2023 - about unchanged at 100¼ bid, 100¾ offered. A second called them steady at 100½ bid, 100¾ offered.

WEX, a South Portland, Maine-based provider of corporate card payment solutions, priced its $400 million of new paper at par, after having upsized the transaction from the originally announced $350 million.

Trinseo trades off

Going back a little further, a trader saw Trinseo Materials Operating SCA's 8¾% senior secured notes due 2019 down by 5/8 point on the day at 101 1/8 bid 101 5/8 offered.

The Berwyn, Pa.-based materials company, along with its Trinseo Materials Finance Inc. unit, had priced its $1.325 billion forward-calendar deal - last week's largest issue - at par on Thursday. The new bonds shot up to above the 102 bid level in initial secondary dealings, only to retreat on Monday.

A second trader said that he did not seen any signs of the megadeal in Monday's market.

Drive-bys struggle along

A pair of quickly shopped deals that hit the market last Tuesday were seen by traders on Monday struggling to even stay above their respective issue prices.

A trader said that Denbury Resources Inc.'s 4 5/8% senior subordinated notes due 2023 were trading around 99½ bid on Monday.

The Plano, Texas-based energy exploration and production company had priced its $1.2 billion offering at par on Tuesday, after having upsized it from the originally announced $1 billion size.

The bonds initially firmed to 100½ bid, 101 offered but gradually came down as the week wore on, going home on Friday at par bid, 100¼ offered and continuing to ease on Monday.

Last Tuesday's other deal, from Dallas-based hospital operator Tenet Healthcare Corp., was likewise trying unsuccessfully to stay above its par issue price during Monday's session.

That $850 million of 4½% senior secured notes due 2021 had initially firmed to 101 bid, 101¼ offered when it began trading around on Tuesday, but those levels slowly eroded to around 100¼ bid, 100 5/8 offered by Friday afternoon, and they continued to come in on Monday.

ENCE trades higher

But while those dollar issues were losing ground from last week's pricing levels, a London-based source said that the recently priced euro-denominated paper was "trading well."

For instance, Spanish pulp producer and renewable energy generator ENCE Energia y Celulosa, SA's €250 million issue of 7¼% senior secured notes due 2020, which priced at par on Friday, traded higher on Monday at 100½ bid, 101 offered.

Loxam rises

French equipment rental company Loxam SAS' 7 3/8% senior subordinated notes due 2020 were better at 100¾ on the day, according to a bond source.

The Lorient, France-based company sold €300 million of the notes at par on Jan. 17.

Smurfit Kappa lower

However, Smurfit Kappa Acquisitions' euro-denominated 4 1/8% senior secured notes due 2020 seemed to buck that mostly positive trend, according to a market source, falling to 98 5/8 on Monday.

The notes had been quoted at 99¾ bid in secondary trading on Friday.

The Dublin, Ireland-based paper-based packaging manufacturer sold €400 million of the notes at par on Wednesday.

New issues dominate

A trader characterized Monday's market as "pretty dead out there." He said that the secondary action "was all new-issue driven."

Everyone was waiting around for Atlas [Pipeline] to price," which didn't happen until fairly late in the session.

Interest-rate impact

A second trader opined, "Your real high-quality stuff was under pressure, with Treasuries backing up the way they did." The 10-year government notes, which had been trading in the mid-to-upper 1.80% area last week, moved above 2% during Monday's session before going out around 1.96%.

He said that "stuff like CIT [Group Inc.], Ally Financial," closely linked to Treasuries, was being pushed back.

Another such name, he said, was "the new Tenet Healthcare deal - a lot of these new four-handle deals are off a half-point to a point."

He added, "The stuff that was most sensitive to interest rates definitely was under pressure right now."

Market measures mostly easier

Statistical junk market performance indicators mostly turned lower on Monday, after having been higher across the board on Friday.

The Markit Series 19 CDX North American High Yield index lost 5/32 on Monday to end at 102¾ bid, 102 7/8 offered, after having gained ¼ of a point on Friday.

The KDP High Yield Daily index lost 6 basis points Monday to finish at 76.17, after having gained 9 bps for a second straight session on Friday, which was its fifth straight gain. Its yield edged up by 1 bp on Monday to 5.39%, after having come in by 3 bps on Friday, its third consecutive decline.

However, the widely followed Merrill Lynch U.S. High Yield Master II index rose for a ninth straight session on Monday, gaining 0.021% , after rising 0.068% on Friday.

That lifted its year-to-date return to 1.991%, a new peak level for the year so far, eclipsing the old mark of 1.97%, which had been notched on Friday.

Cristal Cody contributed to this review

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