New Issue: Graham Packaging prices $625 million two-part deal

St. Louis, Sept. 29 - Graham Packaging LP Co. in conjunction with GPC Capital Corp. I priced $625 million of high-yield bonds on Wednesday, according to market sources.

The company priced a downsized $250 million of eight-year senior notes (Caa1/CCC+) at par to yield 8½%, on the tight end of the 8½%-8¾% price talk. The issue was downsized by $100 million, the amount by which the company upsized its term loan.

The company also priced $375 million of 10-year senior subordinated notes (Caa2/CCC+) at par to yield 9 7/8%. Price talk had the subordinated notes coming 150 basis points behind the senior tranche.

Citigroup, Deutsche Bank Securities and Goldman Sachs & Co. ran the books for the Rule 144A issue. Lehman Brothers and ABN Amro were co-managers.

Proceeds will be used to repay debt and to finance the $1.2 billion acquisition of Owens-Illinois' blow-molded plastic container business, and to fund the tenders for $250 million of the company's 8¾% senior subordinated notes due 2008, $75 million floating-rate subordinated term securities due 2008 and $169 million 10¾% senior discount notes due 2009.

Graham Packaging is a York, Pa., manufacturer of blow-molded plastic containers for food, beverage, household, personal care and automotive lubricants markets.

Issuer:	Graham Packaging LP Co./GPC Capital Corp. I
Amount:	$625 million
Bookrunners:	Citigroup, Deutsche Bank Securities, Goldman Sachs & Co.
Co-managers:	Lehman Brothers, ABN Amro
Settlement date:	Oct. 7
Senior notes
Amount:	$250 million (decreased from $350 million)
Maturity:	Oct. 15, 2012
Coupon:	8½%
Price:	Par
Yield:	8½%
Spread:	462 basis points
Call features:	Make-whole call at Treasuries plus 50 basis points until Oct. 15, 2008, then callable at 104.25, 102.125, par on and after Oct. 15, 2010
Equity clawback:	Until Oct. 15, 2007 for 40% at 108.5
Ratings:	Moody's: Caa1
	S&P: CCC+
Price talk:	8½% to 8¾%
Senior subordinated notes
Amount:	$375 million
Maturity:	Oct. 15, 2014
Coupon:	9 7/8%
Price:	Par
Yield:	9 7/8%
Spread:	578 basis points
Call features:	Make-whole call at Treasuries plus 50 basis points until Oct. 15, 2009, then callable at 104.938, 103.292, 101.646, par on and after Oct. 15, 2012
Equity clawback:	Until Oct. 15, 2007 for 40% at 109.875
Ratings:	Moody's: Caa2
	S&P: CCC+
Price talk:	150 basis points behind senior tranche

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.