Published on 4/20/2009 in the Prospect News High Yield Daily.
New Issue: Georgia Pacific upsizes to $750 million, prices seven-year notes on top of 9% talk
By Paul A. Harris
St. Louis, April 20 - Georgia-Pacific LLC priced an upsized $750 million issue of 8¼% seven-year senior guaranteed notes (Ba3/BB-) at 96.155 to yield 9%, according to an informed source.
"The deal went extremely well," the source said, adding that the notes saw demand sufficient to allow the company to upsize the issue by $150 million from the original $600 million size, and to price it on top of the 9% area price talk despite 3.5%-plus losses in the major U.S. stock markets on Monday.
Banc of America Securities LLC, JP Morgan, Morgan Stanley and RBS Greenwich Capital were joint bookrunners for the quick-to-market Rule 144A for life deal.
The notes will be guaranteed by certain domestic subsidiaries of Georgia-Pacific on a senior unsecured basis.
Proceeds together with cash on hand, will be used for general corporate purposes including repayments of the company's domestic accounts receivable securitization facility and/or its revolver.
Atlanta-based Georgia-Pacific manufactures and markets building products, tissue, packaging, paper, pulp and related chemicals.
| Issuer: | Georgia-Pacific LLC
|
| Amount: | $750 million (upsized from $600 million)
|
| Maturity: | May 1, 2016
|
| Security description: | Senior guaranteed notes
|
| Bookrunners: | Banc of America Securities LLC, JP Morgan, Morgan Stanley, RBS Greenwich Capital
|
| Co-managers: | Deutsche Bank Securities, Credit Suisse, BNP Paribas, Commerz, HSBC, KBC, Mitsubishi, Mizuho, Scotia Capital, SG Corporate & Investment Banking, SunTrust Robinson Humphrey
|
| Coupon: | 8¼%
|
| Price: | 96.155
|
| Yield: | 9%
|
| Spread: | 663 bps
|
| Call protection: | Make-whole provision at Treasuries plus 50 bps until May 1, 2013, then callable at 104.125, 102.063, par on and May 1, 2015
|
| Equity clawback: | Until May 1, 2012 for 35% at 108.25
|
| Trade date: | May 20
|
| Settlement date: | May 24
|
| Ratings: | Moody's: Ba3
|
| Standard & Poor's: BB-
|
| Distribution: | Rule 144A for life
|
| Price talk: | 9% area
|
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