HudBay Minerals sets talk on $1 billion two-part senior notes offering, now pricing Thursday

By Paul A. Harris

Portland, Ore., Nov. 30 – Hudbay Minerals Inc. set price talk and accelerated the timing on its $1 billion two-part offering of senior notes (B3/B), according to a syndicate source.

Notes maturing in January 2025 are talked to yield in the 7 7/8% area. The notes are callable after three years at par plus 75% of the coupon and feature a three-year 35% equity clawback.

Notes maturing in January 2023 are talked to yield 3/8 point inside of the yield of the 2025 notes. The tranche is callable after 2.5 years at par plus 50% of the coupon and features a 2.5-year 35% equity clawback.

Tranche sizes remain to be determined; however, neither tranche will be sized at less than $400 million, the source said.

Timing is accelerated. Books close at 10:30 a.m. ET on Thursday, except for West Coast roadshow attendees.

The Rule 144A and Regulation S for life deal is set to price later on Thursday, which represents an acceleration of the timing; it was originally scheduled to remain in the market into Friday.

Barclays is the lead left bookrunner. RBC Capital Markets and BofA Merrill Lynch are the joint bookrunners. CIBC World Markets, ING, Scotia Capital, BMO Securities, NBC, Morgan Stanley & Co. LLC and GMP Securities are the co-managers.

All of the notes feature 101% poison puts.

The Toronto-based mining company plans to use the proceeds to fund a tender offer for its 9½% senior notes due 2020 and for general corporate purposes.

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