Securitization People and Markets

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Matlin Patterson Asset Management has provided portfolio company Oxford Automotive with interim financing as the metal-formed systems supplier broods over the task of finding alternative financing. The Troy, Mich.-based company made a failed attempt late last month to complete a $240 million notes deal and a $75 million credit facility. The notes deal was pulled on account of market conditions, according to a spokeswoman. Lehman Brothers and Credit Suisse First Boston were leading the bond deal. It could not be confirmed if they were arranging the credit as well. Lehman and CSFB bankers did not return calls.

J.P. Morgan has launched syndication of a $100 million add-on "B" piece for Church & Dwight Co. in order to help back the Arm & Hammer brand owner's purchase of the toothpaste brands from Unilever. The add-on is priced at LIBOR plus 21/4%, according to market players. The new debt will tack on to Church & Dwight's $510 million credit that was completed in 2001 to in part support past acquisitions of USA Detergents and Carter-Wallace's anti-perspirant and pet care businesses.

Citigroup and Merrill Lynch juiced up Cinram International's $900 million "B" piece last week in order to lure more investors into the loan for the DVD and CD manufacturer. The tranche had been slogging along since syndication launched under three weeks ago. Concerns over technology risk, contract expiration and Canadian tax laws were issues that investors were grappling with, buysiders said.

FleetBoston Financial was scheduled to launch syndication last Friday of a $350 million credit for solid waste management company IESI Corp. The deal includes a seven-year, $175 million "B" term loan priced at LIBOR plus 31/2% and a five-year, $175 million revolver priced at LIBOR plus 31/4%, according to a banker. Proceeds from the credit will go toward refinancing IESI's existing debt as well as to finance an undisclosed acquisition, the banker explained. LaSalle Bank signed onto the credit as syndication agent, taking a smaller underwriting commitment, he noted. A few "B" loan commitments rolled into the tranche ahead of the meeting, he added. A Fleet official declined to comment.

Deutsche Bank is in the market with a $185 million senior secured, asset-based credit facility for Hines Horticulture, according to Jeff Meister, director of finance. Hines opted to switch to an asset-based deal from a cash-flow deal for several reasons, including better interest rates, as the company is highly leveraged, Meister said. Moody's Investors Service reported the company's leverage at 4.66 times as of last June and assigned a B1 rating to the credit. The new deal, which includes a five-year, $40 million term loan and a $145 million revolver, is priced in the LIBOR plus 21/4-31/4% and LIBOR plus 13/4-23/4% ranges, respectively, Meister explained. Both tranches are tied to a leverage-based grid.

Wachovia Securities and Bear Stearns pushed back the bank meeting date for DRS Technologies, which was set for last Thursday, to avoid bumping heads with Hurricane Isabel. "The timing wasn't so critical that we had to [have the bank meeting last] week," said Richard Schneider, cfo. The meeting is now scheduled to be held tomorrow, he said.

Jefferies & Co. is planning a major advance in offering services to its middle-market clients and one of its top priorities is to develop ways to offer senior bank lending. "This is a business that makes sense for us in several different configurations and fits in with our business model. In conjunction with our financing abilities in the public and private markets, we will be able to provide senior debt to our clients," explained Ray Minella, director of investment banking capital markets. "We are focused on getting that capability up and running." In terms of timeframe, Jefferies "would like to have it done yesterday. This is a high priority for us," Minella stated.

J.P. Morgan launched syndication last Wednesday of a $1.2 billion refinancing credit for The Scotts Company. The deal includes a $650 million "B" loan and a $550 million revolver. Market players said pricing on the deal is in the LIBOR plus 21/4% range. Scotts, a supplier of lawn and garden care products, has also commenced a cash tender offer for any and all of its $400 million outstanding 85/8% senior subordinated notes due 2009. The tender offer will be financed with the new credit, as well as with a proposed senior subordinated note offering for $200 million. Citigroup and Bank of America are acting as dealer managers in connection with the tender offer. A J.P. Morgan spokesman declined to comment.