Group 1 Automotive plans $200 million tap of 5% notes due 2022 in Thursday drive-by

By Paul A. Harris

Portland, Ore., Sept. 4 – Group 1 Automotive, Inc. plans to price a $200 million add-on to its 5% senior notes due June 1, 2022 (existing ratings B1/BB) on Thursday, according to a market source.

J.P. Morgan Securities LLC, Wells Fargo Securities LLC and BofA Merrill Lynch are the joint bookrunners for the Rule 144A and Regulation S add-on.

The notes become callable on June 1, 2017 at 103.75.

The original $350 million issue priced at par on May 16, 2014.

The Houston-based auto dealership and collision services center chain plans to use the proceeds to repay debt under the acquisition line of its revolver and to make a contribution to its floor plan offset account, which is the amount of excess cash that is used to pay down the floor plan line of its revolver but can be immediately redrawn, according to a Thursday press release from the company.

Approximately $175 million of outstanding debt under the acquisition line was used to finance the conversion and redemption of the company’s 2¼% convertible senior notes due 2036.

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