By Andrea Heisinger
New York, Sept. 7 - H.J. Heinz Co. sold an upsized $700 million of notes (Baa2/BBB+/BBB) in two tranches on Wednesday, according to a market source.
The size of the issuance was increased from a planned $500 million based on high demand from investors, the source said.
The $300 million of 2% five-year notes priced at 99.967 to yield 2.007% with a spread of Treasuries plus 110 basis points. The notes were priced tighter than talk, which was in the 120 bps area.
This tranche has a make-whole call at Treasuries plus 20 bps.
A second tranche was $400 million of 3.125% 10-year notes sold at 98.738 to yield 3.274% with a spread of 125 bps over Treasuries. The notes were priced tighter than guidance in the 135 bps area.
There is a make-whole call at Treasuries plus 20 bps until June 12, 2021 and a par call after that date.
Both tranches feature a change-of-control put at 101%.
Bookrunners were J.P. Morgan Securities LLC, BNP Paribas Securities Corp. and HSBC Securities (USA) Inc.
Senior co-managers were Bank of America Merrill Lynch, Deutsche Bank Securities Inc., Morgan Stanley & Co. LLC, Rabo Securities USA, Inc. and UBS Securities LLC.
Co-managers were Barclays Capital Inc., BNY Mellon Capital Markets LLC, Mitsubishi UFJ Securities (USA) Inc., Banca IMI SpA, PNC Capital Markets LLC, RBS Securities Inc., SG Americas Securities, LLC, SunTrust Robinson Humphrey, Inc., TD Securities (USA) LLC and Wells Fargo Securities, LLC.
Proceeds will be used for general corporate purposes, including repayment of commercial paper.
Heinz was last in the market when its H.J. Heinz Finance Co. unit sold $250 million of 7.125% 30-year bonds at 270 bps over Treasuries on July 22, 2009.
The food product maker is based in Pittsburgh.
| Issuer: | H.J. Heinz Co.
|
| Issue: | Notes
|
| Amount: | $700 million, increased from $500 million
|
| Bookrunners: | J.P. Morgan Securities LLC, BNP Paribas Securities Corp., HSBC Securities (USA) Inc.
|
| Change-of-control put: | 101%
|
| Trade date: | Sept. 7
|
| Settlement date: | Sept. 12
|
| Ratings: | Moody's: Baa2
|
| Standard & Poor's: BBB+
|
| Fitch: BBB
|
|
|
| Five-year notes
|
| Amount: | $300 million
|
| Maturity: | Sept. 12, 2016
|
| Coupon: | 2%
|
| Price: | 99.967
|
| Yield: | 2.007%
|
| Spread: | Treasuries plus 110 bps
|
| Call: | Make-whole at Treasuries plus 20 bps
|
| Price talk: | 120 bps area
|
|
|
| 10-year notes
|
| Amount: | $400 million
|
| Maturity: | Sept. 12, 2021
|
| Coupon: | 3.125%
|
| Price: | 98.738
|
| Yield: | 3.274%
|
| Spread: | Treasuries plus 125 bps
|
| Call: | Make-whole at Treasuries plus 20 bps until June 12, 2021, after at par
|
| Price talk: | 135 bps area
|
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