Published on 9/7/2023 in the Prospect News Investment Grade Daily.
New Issue: Lennox International prices $500 million 5.5% five-year notes with 112.5 bps spread
By William Gullotti
Buffalo, N.Y., Sept. 7 – Lennox International Inc. priced $500 million of 5.5% five-year senior notes (Baa2/BBB) at 99.896 to yield 5.524% on Thursday, according to an FWP and a 424B5 filed with the Securities and Exchange Commission.
The notes are guaranteed by subsidiaries Advanced Distributor Products LLC, Allied Air Enterprises LLC, Heatcraft Inc., Heatcraft Refrigeration Products LLC, Heatcraft Technologies Inc., Lennox Global LLC, Lennox Industries Inc., Lennox National Account Services Inc., Lennox National Account Services LLC, Lennox Procurement Co. Inc., Lennox Services LLC, LGL Australia (US) Inc. and LGL Europe Holding Co.
The notes priced with a spread of 112.5 basis points over Treasuries.
The notes have a make-whole call at Treasuries plus 20 bps before Aug. 15, 2028. There is also a par call, starting on Aug. 15, 2028, for the remaining life of the notes.
BofA Securities, Inc., J.P. Morgan Securities LLC, Wells Fargo Securities, LLC, PNC Capital Markets LLC and U.S. Bancorp Investments, Inc. were the joint bookrunning managers for the offering.
The Richardson, Tex., climate-control products company will use the proceeds to repay, redeem or otherwise retire $350 million total principal amount of its outstanding 3% senior notes due 2023 and for general corporate purposes.
| Issuer: | Lennox International Inc.
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| Guarantors: | Advanced Distributor Products LLC, Allied Air Enterprises LLC, Heatcraft Inc., Heatcraft Refrigeration Products LLC, Heatcraft Technologies Inc., Lennox Global LLC, Lennox Industries Inc., Lennox National Account Services Inc., Lennox National Account Services LLC, Lennox Procurement Co. Inc., Lennox Services LLC, LGL Australia (US) Inc. and LGL Europe Holding Co.
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| Amount: | $500 million
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| Issue: | Senior notes
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| Maturity: | Sept. 15, 2028
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| Bookrunners: | BofA Securities, Inc., J.P. Morgan Securities LLC, Wells Fargo Securities, LLC, PNC Capital Markets LLC and U.S. Bancorp Investments, Inc.
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| Co-managers: | Regions Securities LLC, Scotia Capital (USA) Inc. and Truist Securities, Inc.
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| Trustee: | U.S. Bank Trust Co., NA
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| Counsel to issuer: | Jones Day
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| Counsel to underwriters: | Davis Polk & Wardwell LLP
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| Coupon: | 5.5%
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| Price: | 99.896
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| Yield: | 5.524%
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| Spread: | Treasuries plus 112.5 bps
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| Call features: | Make-whole call before Aug. 15, 2028 at Treasuries plus 20 bps; on or after Aug. 15, 2028 at par
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| Change of control: | At 101 plus interest
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| Trade date: | Sept. 7
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| Settlement date: | Sept. 15
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| Ratings: | Moody’s: Baa2
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| S&P: BBB
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| Distribution: | SEC registered
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| Cusip: | 526107AG2
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