Morning Commentary: FXI, Consol Mining, goeasy seen pricing dollar-denominated deals Friday

By Paul Deckelman

New York, Oct. 27 – High-yield syndicate sources were expecting a trio of new U.S. dollar-denominated and fully junk-rated bond offerings to price during Friday’s session.

FXI notes on tap

FXI Holdings, Inc., a Media, Pa.-based producer of flexible polyurethane foam, is shopping around a $500 million offering of seven-year senior secured notes (B2/B).

Order books are scheduled to close at 11:30 a.m. ET, with pricing expected thereafter.

On Thursday, price talk emerged envisioning a yield in the 8% area. A trader said Thursday that the deal was two times oversubscribed.

The Rule 144A and Regulation S for life deal will come to market via left bookrunner Jefferies LLC, with Deutsche Bank Securities Inc. and BofA Merrill Lynch serving as joint bookrunners.

The notes will come with three years of call protection.

Proceeds from the offering will be used to finance the buyout of FXI by One RockCapital Partners.

Consol Mining to price

Consol Mining Corp., a Pittsburgh-based coal mine operator, is expected to price a $350 million offering of senior secured second-lien notes due 2025 (B3/CCC+) in a deal being led by J.P. Morgan. Securities LLC.

Unofficial estimations heard Thursday called for the deal to come somewhere around the 9% to 9½% yield area, although some market sources said that the deal’s prospects were better if the issuer were to make some investor-friendly tweaks to the covenants and offer the notes at a discount.

Proceeds from the Rule 144A and Regulation S offering are to be used to fund the spinoff of the coal operation from natural gas company Consol Energy Inc., as well as to refinance existing debt of CNX Coal Resources LP under its revolving credit facility, to fund working capital needs and for general corporate purposes.

goeasy talked at 8%-8¼%

First-time issuer goeasy Ltd. is expected to price a $300 million offering of five-year senior notes (Ba3/BB-). Price talk on Thursday envisioned a yield of 8% to 8¼%.

Wells Fargo Securities LLC is the left bookrunner for the Rule 144A and Regulation S for life deal, with BMO Securities as joint bookrunner. CIBC World Markets is the co-manager.

The Mississauga, Ont.-based full-service provider of goods and alternative financial services plans to use the deal proceeds for debt refinancing and general corporate purposes.

Paul A. Harris contributed to this report

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