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Loan Market Commentary 1/19/2010

The loan market was pretty sleepy today. In the morning things had a softer tone and we saw bids fall an eighth to a quarter for most names. From there things leveled off and the market flat lined. Volumes were very light today as a lot of people are focused on the forward calendar. An LCDS BWIC/OWIC was being circulated today with bids/offers due tomorrow. The portfolio contains 21 names and the agent is looking to buy/sell $2 million blocks of each name. The news today was full of new issue announcements and amendment talk so the primary market is still looking hot right now.
 
  • Cenveo Inc is seeking an amendment to its June 2006 credit agreement led by Bank of America Merrill Lynch, according to an SEC filing. The company is looking to incur at least $350 million senior secured refinancing debt, which would be used to pay down its existing facilities.
  • A New York bankruptcy court has confirmed a reorganization plan for Reader's Digest Association Inc, clearing the way for the publishing company to emerge from bankruptcy by the end of the month, the company said on Friday. The plan calls for Reader's Digest Association to reduce its total debt by 75 percent to $555 million from $2.2 billion, by effectively transferring ownership of the company to its lenders through a swap of senior secured debt for equity.
  • Moody's Investors Service upgraded Jarden's senior secured credit facility to Ba1 and the senior unsecured notes to B1 due the change in capital structure from upsizing its senior subordinated notes to $492 million from $400 million. All other ratings, including the B1 CFR, were affirmed. The rating outlook remains positive.
  • Terex Corp has sealed an amendment to its roughly $700 million credit facility dated July 2006 and led by Credit Suisse, sources said. The company asked to hold the $1 billion cash to be received from Bucyrus International Inc for 300 days and during the 300 days, the cash can be used for capital investment or acquisitions. Lenders who consent were given a 15bp amendment fee. The amendment was signed on January 15.
  • Broadlane Inc is seeking a $195 million five-year senior secured credit facility led by Jefferies and UBS, sources said. Proceeds are for refinancing. The deal includes a revolving credit facility and term loan.
  • Travelport's strip rose about 1.5 points to 96.5 bid today after the company launched a $2 billion IPO, sources said. The deal, which values the company at $3 billion, paves the way for an eventual exit of private equity house Blackstone, after it bought a majority stake in 2006, Reuters reported. The company plans to sell $1.775 billion of new shares to institutional investors in an IPO on the London Stock Exchange.
  • Boston Generating LLC's loan moved down about 2 points to 78.5/79.5 after it released its forecasts for 2011-2014, sources said.
  • Commercial real estate services firm CB Richard Ellis Services Inc is offering an upfront fee of 100bp to lenders who extend their commitments in its $357.7 million revolving credit facility maturing on June 24, 2011, $200.5 million revolver-2 maturing on June 24, 2013, and $326.3 million term loan A maturing on Dec. 20, 2011, sources said. In a conference call today, the borrower asked to extend both the revolvers by two years. Pricing will be increased by 50bp on both extended tranches. Revolver-1 currently pays LIB+300 while revolver-2 pays LIB+350.
  • Price talk on Vanguard Health Systems' $765 million term loan is LIB+350 with a 99 OID and a 1.5% Libor floor, sources said The overall loan, led by Bank of America Merrill Lynch, also includes a $260 million revolving credit facility. Proceeds from the loan will refinance the company's existing senior secured credit facilities.