Securitization People and Markets

BondWeek is the leading news publication for fixed-income professionals, covering new deals, structures, asset-backed securities, industry and market activity.

Tesoro Petroleum Corp.'s $150 million "B" loan was two times oversubscribed late last week after the $650 million asset-based credit was pitched to investors last Wednesday. The institutional piece is priced at LIBOR plus 31/2% and the $500 million revolver has a spread of 31/4% over LIBOR, according to a trader familiar with the deal. He noted that $300 million of the revolver is expected to be drawn at closing. There is an up-front fee of 25 basis points on the "B" loan and a 100 basis points up-front fee for $35 million commitments to the pro rata. Pro rata tickets for $25 million also receive 75 basis points up-front and $15 million pro rata ticket holders get 50 basis points. The deal also includes a letter of credit sub-limit of $400 million. Bank One and Goldman Sachs are shopping the underwritten deal with FleetBoston Financial and Bank of America also involved, a banker said.

Rent-A-Center's $400 million "B" loan oversubscribed after lead banks Lehman Brothers and J.P. Morgan pitched the company's $600 million refinancing package to investors last Tuesday. A banker familiar with the deal would not discuss the specific commitment levels, but he confirmed that the "B" piece is being offered at par in the LIBOR plus 21/2-23/4% range. He added that it looks like pricing on the "B" loan could end up closer to the LIBOR plus 21/2% range, but this was not definite. The $80 million letter of credit facility and $120 million revolver are also being pitched to lenders on a three-to-one basis where they commit $3 to the letter of credit facility for every $1 committed to the five-year revolver.

Wachovia Securities pitched into the market a $145 million deal for fishing tackle company Pure Fishing last Wednesday. Proceeds will back a leveraged buyout of the Spirit Lake, Iowa-based company by Whitney & Co. Terms of the transaction could not be ascertained. The credit includes a six-and-a-half year, $110 million "B" piece priced at LIBOR plus 41/4% and a five-year, $35 million revolver priced at LIBOR plus 33/4%. Pure Fishing provides tackle worldwide. Officials at Pure Fishing could not be reached by press time and a Wachovia banker did not return calls. Paul Vigano, a partner at Whitney & Co., also did not return calls.

Citigroup and Lehman Brothers are in the market with a $575 million bank debt exit financing for Hayes Lemmerz International. A banker familiar with the facility would not specify commitment levels, but said the credit was collecting tickets. The deal includes a six-year, $450 million "B" term loan priced at LIBOR plus 41/4% and a five-year, $125 million revolver priced at LIBOR plus 31/2%. There is an up-front fee of 50 basis points on the institutional piece, the banker added, noting the commitment deadline is slated for May 22, but the deal's closing essentially depends on the Northville, Mich.-based automotive wheel supplier's emergence from bankruptcy. Last week, the company announced it was still in hearings with the U.S. Bankruptcy Court to confirm its modified reorganization plan.

Citigroup and J.P. Morgan were scheduled to launch syndication of a $230 million credit for Werner Ladder last Friday as part of the ladder product company's recapitalization efforts. The deal breaks down into a six-year, $170 million "B" loan with price talk around LIBOR plus 31/4% and a five-year, $60 million revolver with pricing around LIBOR plus 3%, according to a banker. Proceeds from the Ba3-rated deal, existing cash and $20 million from an accounts receivable securitization facility will be used to refinance the $115.4 million outstanding on the Greenville, Pa.-based company's existing facility. In addition, Werner is selling $65 million in preferred stock to private equity firm Leonard Green & Partners. Proceeds will also help redeem $150 million of common stock from the existing Werner shareholders. Larry Friend, Werner's v.p., cfo and treasurer, did not return calls.

BondWeek is the leading news publication for fixed-income professionals, covering new deals, structures, asset-backed securities, industry and market activity.

BondWeek is the leading news publication for fixed-income professionals, covering new deals, structures, asset-backed securities, industry and market activity.

BondWeek is the leading news publication for fixed-income professionals, covering new deals, structures, asset-backed securities, industry and market activity.