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Published on 5/2/2017 in the Prospect News Investment Grade Daily.

New Issue: Sherwin-Williams prices $6 billion of senior notes in five fixed-rate tranches

By Cristal Cody

Tupelo, Miss., May 2 – Sherwin-Williams Co. priced $6 billion of senior notes (Baa3/BBB/BBB) in five tranches on Tuesday, according to a market source.

The company sold $1.5 billion of 2.25% three-year notes with a spread of 80 basis points over Treasuries.

Sherwin-Williams sold $1.25 billion of 2.75% five-year notes at Treasuries plus 95 bps.

The $500 million tranche of seven-year notes priced with a 3.125% coupon and a spread of Treasuries plus 105 bps.

In the 10-year tranche, Sherwin-Williams sold $1.5 billion of 3.45% notes with a Treasuries plus 120 bps spread.

The final tranche of $1.25 billion 4.5% 30-year notes priced with a spread of 155 bps over Treasuries.

The notes all priced on the tight side of guidance.

Citigroup Global Markets Inc., Wells Fargo Securities LLC, J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and PNC Capital Markets LLC were the bookrunners.

The notes are redeemable at the greater of a make-whole call and a par call, according to a 424B5 filing with the Securities and Exchange Commission.

Proceeds will be used to finance the purchase price of the company’s planned acquisition of Valspar Corp.

Sherwin-Williams is a Cleveland-based developer, manufacturer and distributor of paints and related products.

Issuer:Sherwin-Williams Co.
Amount:$6 billion
Securities:Senior notes
Bookrunners:Citigroup Global Markets Inc., Wells Fargo Securities LLC, J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and PNC Capital Markets LLC
Trade date:May 2
Ratings:Moody’s: Baa3
S&P: BBB
Fitch: BBB
Distribution:SEC registered
Three-year notes
Amount:$1.5 billion
Maturity:May 15, 2020
Coupon:2.25%
Spread:80 bps over Treasuries
Price guidance:Treasuries plus 85 bps area, plus or minus 5 bps
Five-year notes
Amount:$1.25 billion
Maturity:June 1, 2022
Coupon:2.75%
Spread:95 bps over Treasuries
Price guidance:Treasuries plus 100 bps area, plus or minus 5 bps
Seven-year notes
Amount:$500 million
Maturity:June 1, 2024
Coupon:3.125%
Spread:105 bps over Treasuries
Price guidance:Treasuries plus 110 bps area, plus or minus 5 bps
10-year notes
Amount:$1.5 billion
Maturity:June 1, 2027
Coupon:3.45%
Spread:120 bps over Treasuries
Price guidance:Treasuries plus 125 bps area, plus or minus 5 bps
30-year notes
Amount:$1.25 billion
Maturity:June 1, 2047
Coupon:4.5%
Spread:155 bps over Treasuries
Price guidance:Treasuries plus 160 bps area, plus or minus 5 bps

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