By Andrea Heisinger
New York, July 30 - Estee Lauder Cos. Inc. priced $500 million of senior notes (A2/A/) in two tranches on Monday, an informed source said.
The $250 million of 2.35% 10-year notes priced at 99.911 to yield 2.36% with a spread of Treasuries plus 85 basis points. There is a make-whole call at Treasuries plus 15 bps.
A second tranche of $250 million in 3.7% 30-year bonds sold at 99.567 to yield 3.724% with a spread of Treasuries plus 115 bps. The notes have a make-whole call at 20 bps over Treasuries.
There is a change-of-control provision on a ratings downgrade to below investment grade.
Citigroup Global Markets Inc. and J.P. Morgan Securities LLC were the active bookrunners. Passive bookrunners were BNP Paribas Securities Corp. and Goldman Sachs & Co.
Proceeds will be used to redeem $250 million of outstanding 7.75% senior notes due 2013 and for general corporate purposes, including repayment of commercial paper as it matures and other debt, working capital, acquisitions, capital expenditures, repurchase of class A common stock and transaction fees and expenses for the bond offering.
Estee Lauder was last in the market with a $300 million issue of 7.75% five-year notes priced at 500 bps over Treasuries on Oct. 30, 2008.
The beauty products company is based in New York City.
| Issuer: | Estee Lauder Cos. Inc.
|
| Issue: | Senior notes
|
| Amount: | $500 million
|
| Bookrunners: | Citigroup Global Markets Inc., J.P. Morgan Securities LLC (active), BNP Paribas Securities Corp., Goldman Sachs & Co. (passive)
|
| Change-of-control put: | At 101% on ratings downgrade
|
| Trade date: | July 30
|
| Settlement date: | Aug. 2
|
| Ratings: | Moody's: A2
|
| Standard & Poor's: A
|
|
|
| 10-year notes
|
| Amount: | $250 million
|
| Maturity: | Aug. 15, 2022
|
| Coupon: | 2.35%
|
| Price: | 99.911
|
| Yield: | 2.36%
|
| Spread: | Treasuries plus 85 bps
|
| Call: | Make-whole at Treasuries plus 15 bps
|
|
|
| 30-year bonds
|
| Amount: | $250 million
|
| Maturity: | Aug. 15, 2042
|
| Coupon: | 3.7%
|
| Price: | 99.567
|
| Yield: | 3.724%
|
| Spread: | Treasuries plus 115 bps
|
| Call: | Make-whole at Treasuries plus 20 bps
|
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