U.S. Steel talks upsized $980 million five-year notes at 8½% area; pricing Tuesday

By Paul A. Harris

Portland, Ore., May 3 – United States Steel Corp. upsized its offering of five-year senior secured notes (B1/BB-) to $980 million from $500 million and talked the notes to yield in the 8½% area, market sources said on Tuesday.

The offering is said to be playing to $3 billion in orders, a trader said.

Dealers also accelerated timing on the Rule 144A and Regulation S deal. Books were scheduled to close late this morning, with pricing to follow thereafter. At the time the deal was announced it was scheduled to price on Wednesday.

J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, Barclays, BofA Merrill Lynch, Wells Fargo Securities LLC, PNC Capital Markets and Scotia Capital are the joint bookrunners.

The notes come with two years of call protection.

The Pittsburgh-based steel company plans to use the proceeds to repay debt, focusing on near-term maturities, with any remaining proceeds to be used for general corporate purposes.

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