New Issue: Marquette prices $250 million 10 7/8% seven-year notes at 98.81 to yield 11 1/8%

By Paul A. Harris

St. Louis, Jan. 12 - Marquette Transportation Co., LLC and Marquette Transportation Finance Corp. priced a $250 million issue of 10 7/8% seven-year senior secured notes (B3/B-/) at 98.81 to yield 11 1/8% on Tuesday, according to an informed source.

The yield printed at the tight end of the 11¼% area price talk.

J.P. Morgan Securities Inc. and Wells Fargo Securities were joint bookrunners. BMO Capital Markets was a co-manager.

Proceeds will be used to repay debt.

The issuer is a Paducah, Ky.-based river freight company that operates on the U.S. Inland Waterway System.

Issuers:	Marquette Transportation Co., LLC and Marquette Transportation Finance Corp.
Face amount:	$250 million
Proceeds:	$247,025,000
Maturity:	Jan. 15, 2017
Security description:	Senior secured notes
Bookrunners:	J.P. Morgan Securities Inc., Wells Fargo Securities
Co-manager:	BMO Capital Markets
Coupon:	10 7/8%
Price:	98.81
Yield:	11 1/8%
Spread:	795 bps
Call features:	Make-whole call at Treasuries plus 50 bps until Jan. 15, 2013, then callable at 108.156, 105.438, 102.719, par on and after Jan. 15, 2016
Equity clawback:	35% at 110.875 until Jan. 15, 2013
Change-of-control put:	101%
Trade date:	Jan. 12
Settlement date:	Jan. 19
Ratings:	Moody's: B3
	Standard & Poor's: B-
Distribution:	Rule 144A/Regulation S for life
Price talk:	11¼% area

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