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Venator talks upsized $375 million eight-year notes to yield 5¾% to 6%, pricing Thursday
By Paul A. Harris
Portland, Ore., June 29 – Huntsman Corp. and Venator Materials plc upsized their offering of eight-year senior notes (B2/BB-) to $375 million from $350 million and talked the deal to yield 5¾% to 6%, according to a syndicate source.
Books close at 1 p.m. ET Thursday and the offer is set to price subsequently.
Citigroup Global Markets Inc. is the left bookrunner for the Rule 144A and Regulation S for life sale. BofA Merrill Lynch, JP Morgan Securities LLC, Barclays, HSBC, PNC Capital Markets, RBC Capital Markets LLC, Goldman Sachs & Co. and SunTrust Robinson Humphrey are the joint bookrunners.
The notes feature a make-whole call at Treasuries plus 50 basis points for the first three years, then become callable at par plus 75% of the coupon. They also feature a three-year 40% equity clawback at par plus the coupon and a 101% poison put.
The notes have a special mandatory redemption should the spinoff not be completed by March 31, 2018, in which case the issuer will redeem the notes at par plus accrued interest.
The issuing entities will be Venator Finance Sarl and Venator Materials Corp., wholly owned subsidiaries of Huntsman and Venator Materials.
A concurrent term loan was also upsized to $375 million from $350 million.
Proceeds will initially be placed into escrow pending an initial public offering and will then be used to repay inter-company debt owed to Huntsman and to pay a dividend to Huntsman and its subsidiaries. The transactions are part of the spinoff of Venator from Huntsman. The additional proceeds resulting from the upsizing of the bonds and loan will be used to fund a dividend to Hunstman.
The issuers are manufacturers and marketers of chemical products and are headquartered in The Woodlands, Texas.
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