By Paul Deckelman
New York, April 28 - Clear Channel Communications, Inc. priced an upsized $850 million of 3.7-year senior notes (Ca/CCC) at par to yield 10% late Monday, high yield syndicate sources said.
The quick-to-market issue was increased from an originally announced $400 million.
The notes due Jan. 1, 2018 are being issued by CCU Escrow Corp., a newly-formed subsidiary of San Antonio, Texas-based Clear Channel, a diversified media and entertainment company.
Goldman Sachs & Co., Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. Inc., Deutsche Bank Securities Inc. and Wells Fargo Securities LLC were the joint bookrunners on the deal, the sources said.
The notes are being sold under Rule 144A and Regulation S, with registration rights.
They will carry call protection for the first 2.2 years after issue, or until July 15, 2016, and then will be redeemable at 103 and finally at par, the sources said.
Upon the closing of the notes' offering, CCU Escrow will deposit the gross proceeds of the offering into a segregated escrow account, pending the satisfaction of certain release conditions, including the substantially concurrent redemption of the company's $567.1 million of 5½% senior notes scheduled to mature this coming Sept. 15, including any notes held by a subsidiary of Clear Channel, and its $241 million of 4.9% senior notes due 2015, as well as the assumption of the escrow unit's obligations under the notes. Clear Channel said that it intends to issue a notice of redemption for both of those existing note issues within 30 days of the closing of the new bond deal.
Should the release conditions not be met within 60 days of the notes' issue date, CCU Escrow will redeem the notes at par, plus accrued and unpaid interest up to, but not including, the redemption date.
While the notes will initially be secured by a first-priority interest in the escrow account and its deposits and investment property, following the Clear Channel's assumption of the escrow unit's obligations, the notes will become senior unsecured obligations of Clear Channel and will not be guaranteed by any of its parent companies or subsidiaries.
| Issuer: | CCU Escrow Corp. (a unit of Clear Channel Communications, Inc).
|
| Amount: | $850 million, upsized from original $400 million
|
| Maturity: | Jan. 15, 2018
|
| Securities: | Senior notes
|
| Joint bookrunners: | Goldman Sachs & Co., Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. Inc., Deutsche Bank Securities Inc., Wells Fargo Securities LLC
|
| Coupon: | 10%
|
| Price: | Par
|
| Yield: | 10%
|
| Call protection: | Non-callable until July 15, 2016, then callable at 103 and finally, par.
|
| Trade date: | April 28
|
| Settlement date: | May 1
|
| Ratings: | Moody's: Ca
|
| S&P: CCC
|
| Distribution: | Rule 144A and Regulation S, with registration rights
|
| Marketing: | Quick to market
|
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