By Paul A. Harris
St. Louis, June 13 - Algoma Steel Inc., issuing via Algoma Acquisition Corp. priced a $450 million issue of eight-year senior unsecured notes (Caa1/B-) at par to yield 9 7/8% on Wednesday, according to an informed source.
The yield was printed in the middle of the 9¾% to 10% price talk.
UBS Investment Bank ran the books for the Rule 144A and Regulation S with registration rights deal.
The Sault Ste. Marie, Ont.-based steel producer will also put in place an $850 million credit facility.
Proceeds will be used to help fund Indiana-based Essar Steel Holdings Ltd.'s acquisition of the company for C$1.85 billion.
| Issuer: | Algoma Acquisition Corp.
|
| Amount: | $450 million
|
| Maturity: | June 15, 2015
|
| Security description: | Senior unsecured notes
|
| Bookrunner: | UBS Investment Bank
|
| Coupon: | 9 7/8%
|
| Price: | Par
|
| Yield: | 9 7/8%
|
| Spread: | 466 bps
|
| Call features: | Make-whole at Treasuries plus 50 bps until June 15, 2011, then callable at 104.939, 102.469, par on and after June 15, 2013
|
| Trade date: | June 13
|
| Settlement date: | June 20
|
| Ratings: | Moody's: Caa1
|
| Standard & Poor's: B-
|
| Distribution: | Rule 144A/Regulation S with registration rights
|
| Price talk: | 9¾% to 10%
|
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