ResCap $3 billion notes offering to include high-yield tranche of three-year floating-rate notes

By Paul A. Harris

St. Louis, April 10 - Residential Capital Corp. (ResCap)'s $3 billion bond offering now in the market will include a high-yield tranche of three-year floating-rate notes (Ba1/BB+/BB+), according to a market source.

The junk tranche will be non-callable for one year.

The transaction will also include investment-grade seven-year senior fixed-rate notes and senior floating-rate notes.

Pricing is expected to take place during the middle part of this week.

Bear Stearns & Co., Citigroup, Credit Suisse and JP Morgan are joint bookrunners for the Rule 144A offering. The co-managers are Barclays Capital, BNP Paribas, Deutsche Bank Securities and HSBC.

Proceeds, along with cash from other funding sources, will be used to repay all domestic borrowings from General Motors Acceptance Corp., its parent.

ResCap is the mortgage-lending arm of GMAC.

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