New Issue: Equistar Chemicals upsizes eight-year deal to $450 million, yields 10 5/8%

By Paul A. Harris

St. Louis, April 16 - Equistar Chemicals, LP upsized to $450 million from $325 million its offering of senior notes due May 1, 2011 (B1/BB/B) and priced it Wednesday at par to yield 10 5/8%, according to a syndicate source.

Price talk had tightened Wednesday to the 10 5/8% area from the 10¾% area.

Citigroup, Banc of America Securities, Credit Suisse First Boston and JP Morgan were joint bookrunners. Banc One Capital Markets, BNY Securities, Credit Lyonnais, Scotia Capital, SG Cowen and UBS Warburg were co-managers.

Proceeds from the Rule 144A deal will be used to prepay $300 million of 8½% bonds due 2004 and pay down term loan borrowings.

The issuer is a Houston-headquartered joint venture between Lyondell Chemical Co. and Millennium Chemicals Inc.

Issuer:	Equistar Chemicals, LP
Amount:	$450 million (from $325 million)
Maturity:	May 1, 2011
Security description:	Senior notes
Bookrunners:	Citigroup, Banc of America Securities, Credit Suisse First Boston, JP Morgan (joint)
Co-managers:	Banc One Capital Markets, BNY Securities, Credit Lyonnais, Scotia Capital, SG Cowen, UBS Warburg
Coupon:	10 5/8%
Price:	Par
Yield:	10 5/8%
Spread:	695 basis points
Call features:	Callable with a Treasuries plus 50 basis points make-whole call for the first four years, then callable on May 1, 2007 at 105.313, then at 102.656, declining to par on May 1, 2009 and thereafter
Settlement date:	April 22, 2003
Ratings:	Moody's: B1
	Standard & Poor's: BB
	Fitch: B
Rule 144A Cusip:	29444NAG7
Price talk:	10 5/8% area (reduced from 10¾% area)

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