By Paul A. Harris
St. Louis, Dec. 7 - Edgen Acquisition Corp. priced a $31 million add-on to its 9 7/8% senior secured notes due Feb. 1, 2011 (existing ratings B3/CCC+) at 95.50 on Wednesday, resulting in an 11.04% yield to maturity, according to an informed source.
The add-on notes priced on top of the price talk.
Jefferies & Co. ran the books for the add-on notes that were sold via Rule 144A with registration rights, and Regulation S.
Proceeds will be used to finance the acquisition of Murray International Metals Ltd. U.S. and to repay a portion of Edgen's revolving credit facility.
The original $105 million issue priced at par on Jan. 25, 2005. The total issue size following the add-on is $136 million.
In a related transaction Murray International Metals Ltd. (MIM) is in the market with a $125 million offering of five-year senior secured floating-rate notes, also via Jefferies.
Edgen Corp. recently announced that Jefferies Capital Partners, its principal shareholder, has agreed to acquire MIM through a newly formed acquisition company. Upon completion of the transaction a new holding company formed by Edgen's shareholders called Edgen/Murray LP, will own 100% of both Edgen and MIM. In a related transaction, Edgen will buy the equity interests of Murray International Metals Inc. U.S. MIM's subsidiary, Edgen/Murray LP, will be owned by Jefferies Capital Partners, the management teams of both Edgen and MIM and Murray International Holdings.
Baton Rouge, La.-based Edgen is a distributor of specialty steel pipe, fittings and flanges for use in niche applications, primarily in the oil and gas, processing and power generation industries.
| Issuer: | Edgen Acquisition Corp.
|
| Face amount: | $31 million
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| Maturity: | Feb. 1, 2011
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| Security description | Add-on to the 9 7/8% senior secured notes
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| Bookrunner: | Jefferies & Co.
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| Coupon: | 9 7/8%
|
| Price: | 95.50
|
| Yield: | 11.04%
|
| Spread: | 576 basis points
|
| Call features: | Callable after Feb. 1, 2008 at 104.938, 102.469, par on and after Feb. 1, 2010
|
| Equity clawback: | Until Feb. 1, 2007 for 35% at 109.875
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| Trade date: | Dec. 7
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| Settlement date: | Dec. 16 with accrued interest
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| Ratings: | Moody's: B3
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| Standard & Poor's: CCC+
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| Distribution: | Rule 144A with registration rights and Regulation S
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| Price talk: | 95.50
|
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