New Issue: KAR Auction upsizes to $950 million, prices eight-year notes at par to yield 5 1/8%

Portland, Ore., May 22 – KAR Auction Services, Inc. priced an upsized $950 million issue of eight-year senior notes (B3/expected B) at par to yield 5 1/8% on Monday, according to a market source.

The amount was increased from $800 million.

The yield came tight to early guidance that was announced in the mid-5% area.

JP Morgan Securities LLC, Barclays, BofA Merrill Lynch, Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. were the joint bookrunners.

The Carmel, Ind.-based company plans to use the proceeds to repay a portion of its existing term loans and for general corporate purposes.

The issuer provides vehicle auction services and floorplan financing to independent and franchise used-vehicle dealers.

Issuer:	KAR Auction Services Inc.
Amount:	$950 million, increased from $800 million
Maturity:	June 1, 2025
Securities:	Senior notes
Bookrunners:	JP Morgan, Barclays, BofA Merrill Lynch, Credit Suisse, Goldman Sachs
Co-managers:	BMO, Fifth Third, US Bancorp, KeyBanc, PNC, RBC, SMBC
Coupon:	5 1/8%
Price:	Par
Yield:	5 1/8%
Spread:	297 bps
First call:	Make-whole call at Treasuries plus 50 bps until June 1, 2020, then callable at 103.844
Equity clawback:	40% at 105.125 until June 1, 2020
Trade date:	May 22
Settlement date:	May 31
Ratings:	Moody’s: B3
	S&P: Expected B
Distribution:	Rule 144A and Regulation S for life
Marketing:	Quick to market

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