By Andrea Heisinger
New York, Sept. 15 - Exelis, Inc. priced $650 million of senior notes (Baa3/BBB/BBB+) in two tranches on Thursday, an informed source said.
The downsized $250 million of 4.25% 10-year notes priced at 99.824 to yield 4.289% with a spread of Treasuries plus 335 basis points. The size of the tranche was initially $350 million but was reallocated into the 30-year bonds.
The notes have a make-whole call at Treasuries plus 50 bps until July 1, 2021 and are callable at par after that date.
An upsized second tranche consisted of $400 million of 5.55% 30-year bonds sold at 99.762 to yield 5.581% with a spread of 350 bps over Treasuries. The tranche size was initially $300 million.
There is a make-whole call at Treasuries plus 50 bps until April 1, 2041 and a par call after that date.
Barclays Capital Inc., Citigroup Global Market Inc. and J.P. Morgan Securities LLC were the active bookrunners.
Passive bookrunners were Wells Fargo Securities LLC, RBS Securities Inc., SG Americas Securities LLC, Mitsubishi UFJ Securities (USA) Inc., U.S. Bancorp Investments Inc. and UBS Securities LLC.
The notes were sold under Rule 144A and Regulation S. They feature a change-of-control put at 101%.
Proceeds are being used for general corporate purposes, including working capital and a special distribution to parent company ITT Corp.
The notes are guaranteed by ITT until Exelis' split from the company.
The defense technology segment, and eventual spinoff, from diversified manufacturing company ITT is based in White Plains, N.Y.
| Issuer: | Exelis, Inc.
|
| Guarantor: | ITT Corp. until split from the company
|
| Issue: | Senior notes
|
| Amount: | $650 million
|
| Bookrunners: | Barclays Capital Inc., Citigroup Global Market Inc., J.P. Morgan Securities LLC (active), Wells Fargo Securities LLC, RBS Securities Inc., SG Americas Securities LLC, Mitsubishi UFJ Securities (USA) Inc., U.S. Bancorp Investments Inc., UBS Securities LLC (passive)
|
| Distribution: | Rule 144A and Regulation S
|
| Change-of-control put: | 101%
|
| Trade date: | Sept. 15
|
| Settlement date: | Sept. 20
|
| Ratings: | Moody's: Baa3
|
| Standard & Poor's: BBB
|
| Fitch: BBB+
|
|
|
| 10-year notes
|
| Amount: | $250 million, downsized from $350 million
|
| Maturity: | Oct. 1, 2021
|
| Coupon: | 4.25%
|
| Price: | 99.824
|
| Yield: | 4.289%
|
| Spread: | Treasuries plus 335 bps
|
| Call: | Make-whole at Treasuries plus 50 bps until July 1, 2021, after at par
|
|
|
| 30-year bonds
|
| Amount: | $400 million, increased from $300 million
|
| Maturity: | Oct. 1, 2041
|
| Coupon: | 5.55%
|
| Price: | 99.762
|
| Yield: | 5.581%
|
| Spread: | Treasuries plus 350 bps
|
| Call: | Make-whole at Treasuries plus 50 bps until April 1, 2041
|
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