Published on 5/20/2020 in the Prospect News High Yield Daily.
New Issue: Goodyear sells upsized $200 million tap of 9½% notes due 2025 at 101.75 to yield 9.056%
By Paul A. Harris
Portland, Ore., May 20 – Goodyear Tire & Rubber Co. priced an upsized $200 million add-on to its 9½% senior notes due May 31, 2025 (B2/B+/BB-) at 101.75, resulting in a 9.056% yield to maturity, market sources said on Wednesday.
Goldman Sachs & Co. LLC was the left bookrunner. Joint bookrunners were Barclays, BNP Paribas Securities Corp., BofA Securities Inc., Citigroup Global Markets Inc., Credit Agricole CIB, Deutsche Bank Securities Inc., J.P. Morgan Securities LLC and Wells Fargo Securities LLC.
The issue size increased from $150 million.
The issue price came rich to price talk in the 101.5 area. Initial talk was 101 to 101.5.
The Akron, Ohio-based tire manufacturer plans to use the proceeds for general corporate purposes, which may include a redemption of its 8¾% notes due Aug. 15, 2020 at or prior to maturity. Pending that use of proceeds the company said it might make a temporary repayment of debt under its revolving credit facility.
| Issuer: | Goodyear Tire & Rubber Co.
|
| Amount: | $200 million, increased from $150 million
|
| Maturity: | May 31, 2025
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| Security description: | Add-on to 9½% senior notes due May 31, 2025
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| Left bookrunner: | Goldman Sachs & Co. LLC
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| Joint bookrunners: | Barclays, BNP Paribas Securities Corp., BofA Securities Inc., Citigroup Global Markets Inc., Credit Agricole CIB, Deutsche Bank Securities Inc., J.P. Morgan Securities LLC and Wells Fargo Securities LLC
|
| Co-managers: | BBVA Securities Inc., Banco Bradesco BBI SA, MUFG, Natixis Securities Americas LLC, PNC Capital Markets LLC, SMBC Nikko Securities America Inc. and UniCredit Capital Markets LLC
|
| Coupon: | 9½%
|
| Price: | 101.75
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| Yield to maturity: | 9.056%
|
| Spread: | 870 bps
|
| First call: | May 31, 2022 at 104.75
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| Trade date: | May 20
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| Settlement date: | May 22 with accrued interest
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| Ratings: | Moody's: B2
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| S&P: B+
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| Fitch: BB-
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| Distribution: | SEC registered
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| Price talk: | 101.5 area
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| Marketing: | Drive-by
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| Original issue: | $600 million priced on May 13, 2020
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| Total issue size: | $800 million
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