Air Transport Services talks $400 million eight-year notes at 4 7/8% area yield; pricing Thursday

By Paul A. Harris

Portland, Ore., Jan. 16 – Air Transport Services Group, Inc. talked its $400 million offering of eight-year senior notes (Ba3/B+) to yield in the 4 7/8% area, according to market sources.

Official talk comes through initial guidance in the 5¼% area.

Books close at 1:30 p.m. ET on Thursday, and the Rule 144A and Regulation S for life deal is set to price thereafter.

SunTrust Robinson Humphrey Inc. is the left bookrunner. BofA Securities Inc., J.P. Morgan Securities LLC, PNC Capital Markets LLC and Regions Securities LLC are the joint bookrunners.

BBVA Securities Inc., Goldman Sachs & Co. LLC, CIBC World Markets Corp. and Loop Capital Markets LLC are the co-managers.

The notes become callable after three years at par plus 50% of the coupon and feature 40% equity clawback.

The Wilmington, Ohio-based company plans to use the proceeds to pay down its revolver.

The issuing entity is Cargo Aircraft Management, Inc., a wholly owned subsidiary of Air Transport Services, an aircraft leasing and air cargo transportation services provider and the largest provider of passenger charter service to the U.S. Department of Defense.

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