Published on 12/13/2006 in the Prospect News High Yield Daily.
New Issue: Georgia-Pacific sells upsized $1.25 billion notes - eight years at 7%, 10 years at 7 1/8%
By Paul A. Harris
St. Louis, Dec. 13 - Georgia-Pacific Corp. priced $1.25 billion of senior guaranteed notes (Ba3/B) on Wednesday, in a two-part transaction that was upsized from $1 billion, according to an informed source.
The Atlanta-based paper and building products company priced a $500 million tranche of eight-year notes at par to yield 7%, on top of price talk.
In addition Georgia-Pacific priced a $750 million tranche of 10-year notes at par to yield 7 1/8%, at the tight end of the 7¼% area price talk.
Banc of America Securities LLC, Citigroup and Deutsche Bank Securities were joint bookrunners, with Banc of America Securities as the left lead.
The Rule 144A notes will be guaranteed by certain domestic subsidiaries.
Proceeds will be used to help repay the company's $2.25 billion second-lien senior secured term loan.
With the $250 million upsizing of the bond deal, the company withdrew from a planned $250 million add-on to its revolving credit facility.
| Issuer: | Georgia-Pacific Corp.
|
| Total amount: | $1.25 billion (increased from $1 billion)
|
| Security description: | Senior guaranteed notes
|
| Bookrunners: | Banc of America Securities LLC, Citigroup, Deutsche Bank Securities
|
| Co-managers: | Barclays Capital, Lehman Brothers, Mitsubishi, Mizuho, RBS, Scotia Capital, Sumitomo, SunTrust Robinson Humphrey
|
| Trade date: | Dec. 13
|
| Settlement date: | Dec. 29
|
| Ratings: | Moody's: Ba3
|
| Standard & Poor's: B
|
| Distribution: | Rule 144A
|
|
|
| Eight-year notes
|
| Amount: | $500 million
|
| Maturity: | Jan 15, 2015
|
| Coupon: | 7%
|
| Price: | Par
|
| Yield: | 7%
|
| Spread: | 247 bps
|
| Call features: | Callable on Jan. 15, 2011 at 103.50, 101.75, par on and after Jan. 15, 2013
|
| Equity clawback: | Until Jan. 15, 2010 for 35% at 107.0
|
| Price talk: | 7% area
|
|
|
| 10-year notes
|
| Amount: | $750 million
|
| Maturity: | Jan. 15, 2017
|
| Coupon: | 7 1/8%
|
| Price: | Par
|
| Yield: | 7 1/8%
|
| Spread: | 258 bps
|
| Call features: | Callable on Jan. 15, 2012 at 103.563, 102.375, 101.188, par on and after Jan. 15, 2015
|
| Equity clawback: | Until Jan. 15, 2010 for 35% at 107.125
|
| Price talk: | 7¼% area
|
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