Quintiles, Caribe break; Allied Waste dips; GM softens; Sports Authority sets talk; Burlington overfills

By Sara Rosenberg

New York, March 30 - Quintiles Transnational Corp.'s credit facility freed for trading on Thursday, with the first-lien term loan quoted atop 101 and the second-lien term loan wrapped around 102. And, Caribe Information Investment Inc. broke for trading as well, with its term loan quoted in the 101 type context.

In other trading news, Allied Waste Industries Inc.'s institutional bank debt fell off as recent repricing worries and general secondary loan market heaviness weighed on the paper, and General Motors Corp.'s revolver weakened with market technicals blamed as the culprit.

Moving to the primary, The Sports Authority Inc. launched its term loan B with lower-than-previously expected price talk. Also, Burlington Coat Factory Warehouse Corp.'s term loan is nearly two times oversubscribed, leading some investors to believe that pricing on the tranche will most likely finalize at the low end of original guidance.

Quintiles Transnational's credit facility hit the secondary on Thursday, with the $1 billion first-lien term B due 2013 (B1/BB-) quoted at 101 bid, 101½ offered and the $220 million second-lien term loan C due 2014 (B3/B) quoted at 101¾ bid, 102½ offered, according to a trader.

The first-lien term loan B is priced with an interest rate of Libor plus 200 basis points. During syndication, the tranche was upsized from $900 million with pricing coming down from Libor plus 225 basis points price talk on strong demand.

Meanwhile, the second-lien term loan C is priced with an interest rate of Libor plus 400 basis points and contains call protection of 102 in year one and 101 in year two. During syndication, this tranche was downsized from $320 million and pricing was reverse flexed from Libor plus 450 basis points.

Quintiles' $1.445 billion credit facility also contains a $225 million revolver due 2012 (B1/BB-) with an initial interest rate of Libor plus 225 basis points. The revolver was downsized from $250 million during syndication, but pricing was left unchanged.

Citigroup, JPMorgan and Morgan Stanley are the lead banks on the deal, with Citi the left lead.

Proceeds, along with cash on hand, will be used to fund the tender offer for Quintiles' $450 million 10% senior subordinated notes due 2013 and Pharma Services Intermediate Holding Corp.'s $219 million 11.5% senior discount notes due 2014.

Quintiles is a Durham, N.C., pharmaceutical services company.

Caribe frees to trade

Caribe's credit facility also freed for trading Thursday with its $155 million seven-year term loan quoted around 101 with little volume seen in the name, according to a trader.

The term loan is priced with an interest rate of Libor plus 225 basis points. During syndication, pricing on the tranche was reverse flexed from original price talk of Libor plus 250 basis points.

Caribe's $165 million credit facility (B1/B) also contains a $10 million revolver that is priced at Libor plus 225 basis points as well, after reverse flexing during syndication from original Libor plus 250 basis points price talk.

Lehman and Bank of America are joint lead arrangers and joint bookrunners on the deal, with Lehman the left lead. Wachovia is documentation agent.

Proceeds will be used to help fund Welsh, Carson, Anderson & Stowe's buyout of Caribe from Verizon and Puerto Rico Telephone Co.

Caribe owns interests in directories in Puerto Rico and the Dominican Republic.

Allied Waste trades down

Allied Waste's institutional bank debt dropped off as the overall loan market felt somewhat heavy and investors continued to show some reaction to the company's recent repricing proposal, according to a trader.

The company's term loan B and institutional letter-of-credit facility, which trade as a strip, were quoted at par 1/8 bid, par 5/8 offered, down about a quarter to three eighths of a point from previous levels, the trader said.

"The market felt a little heavy so there are just better sellers. It's still cheap to the bonds so all you need is one big buyer to push this thing back up," the trader added.

On Monday, news emerged that the Scottsdale, Ariz., waste services company is working on a repricing amendment to its term loan B and letter-of-credit facility that would reduce the spread on the two tranches to Libor plus 150 basis points from current pricing of Libor plus 200 basis points.

JPMorgan is leading the repricing.

GM retreats

GM's revolving credit facility took a step back after a nearly 10 point run-up during the previous session as people were probably just engaging in some profit taking, according to traders.

The revolver was quoted at 90 bid, 92 offered, down from Wednesday's levels of 92½ bid, 94 offered, traders said.

On Wednesday, the bank debt rallied from the 83 bid, 84 offered context as talk began circulating that a refinancing of the $5.6 billion unsecured line of credit could be in the works, based on some remarks in the company's 10-K filing.

GM had said in the filing that it is exploring the possibility of amending or replacing its existing revolver with new terms since it is unsure as to whether lenders would allow any borrowings under the facility due to the recent restatement of prior financial statements.

The company needed to restate financial results for its financing arm, General Motors Acceptance Corp., from 2003 through the third quarter of 2005 as a result of improper classification and presentation of cash flows for certain mortgage loans.

GM is a Detroit-based designer, manufacturer and marketer of cars and light trucks.

Sports Authority price talk

Sports Authority decided to launch its $300 million seven-year covenant-light term loan B Thursday with opening price talk of Libor plus 250 basis points, as opposed to the previously outlined price talk of Libor plus 300 basis points that was announced in the loan commitment letter, according to a market source.

Bank of America, Credit Suisse and Lehman Brothers are the lead banks on the deal, with Bank of America the left lead.

The $1.05 billion senior secured credit facility also contains a $685 million five-year ABL revolver talked at Libor plus 150 basis points with a 25 basis point commitment fee and a $65 million five-year first-in, last-out ABL revolver advance talked at Libor plus 300 basis points.

Proceeds will be used to help fund the leveraged buyout of Sports Authority by Leonard Green & Partners LP and Sports Authority's senior management for $37.25 per share in cash. The total transaction value, including assumed debt, is $1.3 billion.

In addition to the new bank debt, the transaction will be financed with a $370 million equity commitment and TCW/Crescent Mezzanine has committed to purchase $275 million of senior subordinated notes, which could be increased to $350 million.

The transaction is expected to close in the second fiscal quarter and is subject to Sports Authority's shareholder approval, as well as other customary closing conditions, including the receipt of financing and regulatory approvals.

Sports Authority is an Englewood, Colo., full-line sporting goods retailer.

Burlington book shuts

Burlington's term loan B (B2/B/B-) has netted close to double the amount of commitments needed to fill the book as Thursday's commitment deadline came and went, creating the anticipation among some market players that pricing will firm up at the tight end of talk, according to a fund manager.

The $775 million term loan B was launched earlier this month to investors with price talk of Libor plus 225 to 250 basis points.

"I heard they have about $1.5 billion of orders for the $775 million term loan. Based on that I'd guess that pricing will end up at the low end of the 225-250 [basis points] guidance that they gave earlier," the fund manager said.

Burlington's $1.575 billion credit facility also contains an $800 million ABL revolver (NA/NA/BB-) that is split into a $735 million tranche talked at Libor plus 150 basis points and a $65 million first-in, last-out tranche A+ talked at Libor plus 325 basis points.

Bear Stearns and Bank of America are the joint lead arrangers and joint bookrunners on the deal.

Borrowings under the revolver are limited by a borrowing base which is calculated periodically based on specified percentages of the value of eligible inventory and eligible credit card receivables, subject to certain reserves and other adjustments.

Security for the revolver is a perfected first-priority lien on all inventory and accounts of the company and its subsidiaries and a perfected second-priority lien on substantially all other real and personal property.

Security for the term loan is a perfected first-priority lien on substantially all real and personal property and a perfected second-priority lien on all inventory and accounts.

Proceeds will be used to help fund Bain Capital Partners LLC's leveraged buyout of the Burlington, N.J., retailer of branded apparel for $45.50 per share in cash, or approximately $2.06 billion.

In addition to the facility, Burlington also plans on issuing $500 million in bonds -split into a $200 million senior subordinated notes offering and a $300 million senior notes offering - and up to $500 million in equity.

GPX expected to price at low end

GPX International Tire Corp. is another deal that is expected to see its term loan end up at the tight end of talk as the book is already 1½ times oversubscribed with the commitment deadline not scheduled until this coming Tuesday, according to a market source.

The $110 million term loan is anticipated to see pricing finalized at Libor plus 250 basis points, the low end of the original Libor plus 250 to 275 basis points price talk.

GPX's $160 million credit facility also contains a $50 million revolver.

Royal Bank of Scotland is the lead bank on the deal that will be used by the tire company to refinance debt and fund acquisitions.

Dura closes

Dura Automotive Systems Inc. closed on its $75 million second-lien term loan add-on due May 2011 (B3/B) that is priced with an interest rate of Libor plus 350 basis points, in line with existing second-lien pricing.

At launch, the add-on was talked at Libor plus 400 basis points, but pricing came in on strong market demand.

JPMorgan acted as the lead bank on the deal that is being used for general corporate purposes.

Dura is a Rochester Hills, Mich., automotive components manufacturer.

Sagittarius closes

Sagittarius Restaurants LLC, the parent company for Captain's D's Seafood, completed its acquisition of Del Taco Inc., according to a news release.

To help fund the acquisition, Sagittarius got a new $330 million credit facility (B) consisting of a $270 million term loan B with an interest rate of Libor plus 225 basis points and a $60 million revolver with an interest rate of Libor plus 250 basis points.

During syndication, pricing on the term loan B was reverse flexed from original price talk at launch of Libor plus 250 to 275 basis points and revolver pricing came in at the tight end of original price talk of Libor plus 250 to 275 basis points.

JPMorgan acted as the lead bank on the deal.

Private equity investors in the acquisition are Grotech Capital Group, Charlesbank Capital Partners, Leonard Green & Partners LP and Stockwell Capital LLC.

Captain D's is a Nashville, Tenn., seafood quick-service restaurant chain. Del Taco is a Lake Forest, Calif., Mexican quick-serve chain.

Stratus Technologies closes

Stratus Technologies Inc. closed on its new $330 million credit facility consisting of a $200 million first-lien term loan (B1/B-) with an interest rate of Libor plus 300 basis points, a $30 million revolver (B1/B-) and a $100 million second-lien term loan (Caa1/CCC) with an interest rate of Libor plus 900 basis points.

During syndication, the first-lien term loan was upsized from $175 million while the second-lien term loan was downsized from $125 million. In addition, pricing on the first-lien term loan came in at the high end of the original spread guidance of Libor plus 275 to 300 basis points, while pricing on the second-lien term loan came up from original talk of Libor plus 700 to 750 basis points.

Goldman Sachs and Deutsche Bank acted as the lead banks on the deal, with Goldman the left lead.

Proceeds from the credit facility are being used to fund a tender offer for all of the company's outstanding 10.375% senior notes due 2008.

Stratus Technologies is a Maynard, Mass., solutions provider to customers in telecommunications, financial services, banking, manufacturing, life sciences, public safety, transportation & logistics and other industries.

Cablevision closes

Cablevision Systems Corp., through its subsidiary CSC Holdings Inc., closed on its $3.5 billion seven-year term loan B (Ba3/BB) that carries an interest rate of Libor plus 175 basis points, according to an 8-K filed with the Securities and Exchange Commission Thursday.

Bank of America and Citigroup acted as the lead banks on the deal, with Bank of America the left lead.

Covenants include a limitation on the incurrence of additional debt based upon a maximum ratio of total debt to cash flow of 7.50:1 reducing down in increments to 5.00:1 on and after Jan. 1, 2010 and a ratio of total borrowings to cash flow of 4.5:1.

At close, on Wednesday, the company used $400 million of the new term loan B to repay existing term loan A-2 borrowings.

Remaining proceeds are expected to be used to fund a special dividend of up to $3 billion.

However, if the board of directors does not declare a special dividend equal to the remaining $3 billion, CSC Holdings expects to repay these proceeds, the filing added.

Recently the board of directors appointed a special committee of independent directors to evaluate the proposed special dividend and make a recommendation to the board as to whether a dividend should be paid and, if so, in what amount.

The company is trying to settle a lawsuit that is pending in New York Supreme Court in Nassau County and which, among other things, challenged, and sought to enjoin, the special dividend.

A memorandum of understanding regarding settlement of a lawsuit was entered into on March 27. The proposed settlement is subject to court approval.

Cablevision is a Bethpage, N.Y., media, entertainment and telecommunications company.

Caraustar closes

Caraustar Industries Inc. closed on its amended and restated $145 million five-year senior secured credit facility, consisting of a $110 million revolver and a $35 million term loan.

Security is substantially all assets of the company other than real property.

Proceeds from the facility are being used to fund the redemption of the company's 9 7/8% senior subordinated notes due 2011.

Caraustar is an Austell, Ga., recycled paperboard and packaging company.

Advantage Sales closes

J.W. Childs Associates LP and Merrill Lynch Global Private Equity completed the acquisition of a majority equity interest in Advantage Sales & Marketing Inc. for an enterprise value of $1.05 billion from Allied Capital Corp., according to a news release.

To help fund the transaction, Advantage Sales & Marketing got a new $540 million senior secured credit facility, consisting of a $480 million seven-year first-lien term loan with an interest rate of Libor plus 200 basis points and a $60 million six-year revolver with an interest rate of Libor plus 250 basis points.

During syndication, pricing on the term loan was reduced from original price talk at launch of Libor plus 250 basis points.

UBS and Citigroup acted as joint lead arrangers and bookrunners on the deal.

Advantage Sales & Marketing is an Irvine, Calif., sales and marketing agency.

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