By Paul A. Harris
Portland, Ore., April 27 – Garda World Security Corp. priced a downsized $500 million issue of 8¾% eight-year senior notes (Caa2/CCC+/B-) at 99.278 to yield 8 7/8% on Thursday, according to a syndicate source.
The amount was decreased from $630 million with the shift of $100 million of proceeds to a term loan and the potential issuance of additional senior unsecured debt and/or equity pending participation in a concurrent change of control offer.
The yield printed in the middle of the 8¾% to 9% yield talk.
Global coordinator Citigroup Global Markets Inc. was the left bookrunner. Global coordinator Barclays was a joint bookrunner. Macquarie Capital, SG CIB and TD Securities were also joint bookrunners.
Under the provisions of a special mandatory redemption feature, to the extent Garda’s outstanding notes are not tendered in the pending change-of-control offer or tender offer, the issuer must redeem at par an amount of the new notes equal to 101% of the existing notes that were not tendered.
The Montreal-based cash logistics and security solutions provider plans to use the proceeds from the sale of the new eight-year notes to refinance debt and for general corporate purposes, including a dividend to fund a stock repurchase.
| Issuer: | GW Honos Security Corp., to be amalgamated to form Garda World Security Corp.
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| Face amount: | $500 million
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| Proceeds: | $496,390,000
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| Maturity: | May 15, 2025
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| Securities: | Senior notes
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| Bookrunners: | Citigroup (left), Barclays
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| Joint bookrunners: | Macquarie, SG, TD
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| Coupon: | 8¾%
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| Price: | 99.278
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| Yield: | 8 7/8%
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| Spread: | 667 bps
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| Call: | Make-whole call at Treasuries plus 50 bps until May 15, 2020, then callable at 106.563
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| Equity clawback: | 40% at 108.75 until May 15, 2020
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| Trade date: | April 27
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| Settlement date: | May 8
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| Ratings: | Moody’s: Caa2
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| S&P: CCC+
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| Distribution: | Rule 144A and Regulation S for life
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| Price talk: | 8¾% to 9%
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| Marketing: | Roadshow
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