By Paul A. Harris
Portland, Ore., June 5 – L Brands, Inc. priced a $500 million issue of 7½% 10-year senior notes (existing ratings Ba1/BB) at 98.286 to yield 7¾% in a quick-to-market Wednesday trade, according to market sources.
In the secondary market, late Wednesday afternoon, the bonds were straddling the new issue price at 98¼ bid, 99 offered, according to an investor, who professed the belief that the deal was priced 25 basis points too tight.
The deal, which priced on the investment-grade syndicate desk, was in the market with initial price talk in the mid-to-high 7% area.
Citigroup Global Markets Inc., BofA Securities Inc., HSBC Securities (USA) Inc. and J.P. Morgan Securities LLC were the joint bookrunners.
The Columbus, Ohio, specialty store chain operator plans to use the proceeds, together with about $300 million of cash on hand, to fund tender offers for any and all of its $338.38 million outstanding of 7% notes due 2020 and up to $449 million of its 6 5/8% senior notes due 2021, its 5 5/8% senior notes due 2022 and its 5 5/8% senior notes due 2023. Including the tender premiums, the amount of the purchases could total up to $800 million.
The company’s brands include Victoria’s Secret, PINK and Bath & Body Works.
| Issuer: | L Brands, Inc.
|
| Amount: | $500 million
|
| Maturity: | June 15, 2029
|
| Securities: | Senior notes
|
| Bookrunners: | Citigroup Global Markets Inc., BofA Securities Inc., HSBC Securities (USA) Inc. and J.P. Morgan Securities LLC
|
| Coupon: | 7½%
|
| Price: | 98.286
|
| Yield: | 7¾%
|
| Call protection: | Five years
|
| Trade date: | June 5
|
| Settlement date: | June 20
|
| Existing ratings: | Moody's: Ba1
|
| S&P: BB
|
| Distribution: | SEC registered
|
| Marketing: | Quick to market
|
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