The largest repricing in the B-term loan market; SolarWinds announces spin-off closing date

Last week, the CLO universe saw more corporate restructurings and new rating assignments. Elements Solutions has reached a deal for an addition of $ 400 million to its current senior secured B term loan, Carnival Corp has revised the price of a senior secured term loan that will save the company over $ 120 million in annual future interest, and more …

In Trepp’s weekly CLO market roundup, we recap daily TreppWirestories that highlighted the latest headlines impacting the leveraged loan and corporate CLO markets.

If you would like to see the CLO headline coverage in your inbox every morning, click here. Read below for an overview and see how these developments could impact the prices of leveraged loans.

Here, see an overview of the loans that faced the biggest price movement last week. Find The complete list of Trepp,as well as the managers who have the greatest exposure to each loan in the TreppCLO product.

Scientific games to restructure companies; Sale of mules

Gaming company Scientific Games (SGMS) has announced that it will be phasing out its lottery and sports betting business. Initially, the company was evaluating an IPO and recently explored the idea of ​​combining with a special purpose acquisition company or a business sale / merger. In the first quarter of 2021, the lottery segment generated $ 248 million in revenue, representing 34% of the company’s total revenue and a 17% increase from last year. By selling the Lottery and Sports Betting segments of the company, SGMS will be able to focus on its Gaming, iGaming and SciPlay activities and continue to reduce its balance sheet.

SGMS is represented in the CLO universe by the $ 4.2 billion Scientific Games International – B6 Term Loan(L + 275; expiry 2024). The facility was owned by more than 510 CLO vehicles as of May – about 50% of all US transactions in the Trepp CLO database. Installation has been actively negotiated since our last reported itin May, the majority of the activity being “sell” transactions at a price slightly below par. IHS Markit quoted their price roughly at par last week.

Carnival Corp Saves Over $ 120 Million Through “Biggest Revaluation In B-Term Loan Market”

Carnival Corporation has revised the price of its senior secured term loan,whichcomposed of a tranche of 1.86 billion dollars and a tranche of 800 million euros. The US dollar portion of the facility now has an interest rate of LIBOR plus a 3% margin, which is 4.5% below its pre-revaluation margin. In addition, the euro portion now has a EURIBOR plus 3.75% interest rate, which is 3.75% less than its previous margin. The price review will save the company more than $ 120 million in future annual interest, and led to comments from Carnival CFO David Bernstein on its incredibly successful transition.

Carnival is represented in the CLO universe with the Carnival Corporation – 5/21 term loan of $ 1.8 billion (L + 300; due 2025) and the Carnival Corporation – B term loan of 794 million euros ( E + 375; expiry 2025). Newly refinanced, the loans were redeemed after having originated at a level slightly below par. The larger US-denominated credit has seen a few above par sale transactions – where IHS Markit recently listed both facilities.

SolarWinds announces closing date of spin-off, N-able

IT management software company SolarWinds Corporation has announced that the split of its Managed Service Provider (MSP) business has materialized. Dubbed “N-able”, the new company will provide cloud-based software solutions to MSPs, enabling them to support digital growth in small and medium-sized businesses. SolarWinds will retain its core IT management business, which primarily provides IT infrastructure management software to enterprise IT organizations. N-able will trade on the NYSE under the symbol “NABL”.

SolarWinds is represented in the CLO universe with the 2.0 billion dollars SolarWinds Holdings – Term Loan B(L + 275; expiry 2024). The facility was owned by 134 managers and more than 320 CLO vehicles as of May – approximately 31% of all U.S. transactions in the Trepp CLO database.

The term loan has been heavily traded since its inception and continued to generate frequent business activity throughout the pandemic. It was then sold heavily when news broke that the company’s computer software had been hacked and probably information exposed on several government agencieslast december. In early 2021, the price of credit continued to recover as “sell” transactions persisted. Since then, the facility has been actively traded, with IHS Markit citing its price last week as slightly below par.

Element Solutions Adds $ 400 Million to Term Loan B

Specialty chemicals company Element Solutions has announced that it has reached an agreement for an addition of $ 400 million to its currently secured senior B term loan. This addition is conditional on the closing of the announced acquisition of Coventya Holding SAS for 420 million euros. The proceeds from the add-on will be used to finance part of the acquisition, as well as for general corporate purposes.

Element Solutions is represented in the CLO universe by the $ 744 million Element Solutions – Term Loan Tranche B-1(L + 200; due in 2026). The facility was owned by 29 managers and more than 90 CLO vehicles as of May – approximately 9% of all U.S. transactions in the Trepp CLO database. The facility was traded heavily prior to this year and saw increased activity through February at a price equal to and slightly above par. As 2021 progressed, activity slowed down, with a few “sell” transactions having taken place at par since then. IHS Markit recently rated the facility slightly above par.

Fitch assigns ratings to JBS unsecured, RCF and secured term loans

Fitch has assigned a long-term issuer default rating (IDR) of “BBB-” to the 2028, 2029, 2030 and 2031 senior unsecured bonds of food processing company JBS USA Lux SA. Additionally, JBS’s $ 900 million senior secured revolving credit facility and $ 1.9 billion secured term loan were rated “BBB” as the company’s rating outlook remained. stable.

JBS is represented in the CLO universe with the $ 1.9 billion JBS USA Holdings – Term Loan B(L + 200; due in 2026). The facility was owned by more than 230 CLO vehicles in May, or about 22% of all U.S. transactions in the Trepp CLO database.The facility was actively traded in 2021, with near par purchase transactions constituting the bulk of its initial activity. The term loan was recently sold at a price slightly below par, where IHS Markit quoted its price last week.

General price data

Issues in the CLO market increased slightly, with 21 transactions being assessed. There were nine new chords, three refi and nine reset chords. 19 bids came from the US market while the rest came from the EU.

Best New Execution in the U.S. Market Was $ 639.83 Million Golden tree 10, which featured an AAA class at L + 110. The deal was managed by GoldenTree and arranged by Morgan Stanley, Bank of America and Wells Fargo.

There were no new executions in the EU market.

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