Published on 12/13/2013 in the Prospect News High Yield Daily.
New Issue: Memorial Resource prices $350 million 10%/10¾% PIK toggle notes due 2018 at 98
By Paul A. Harris
Portland, Ore., Dec. 13 - Memorial Resource Development LLC and Memorial Resource Finance Corp. priced a $350 million issue of five-year senior PIK toggle notes (B3/B-/) at 98 to yield 10.524% on Friday, according to a syndicate source.
The notes pay a 10% cash coupon which toggles to 10¾% for PIK payments.
The coupons and issue price came on top of talk.
Citigroup Global Markets Inc., BMO Capital Markets Corp. and Wells Fargo Securities LLC were the joint bookrunners.
Proceeds will be used to finance a distribution to funds managed by NGP Capital Resources Co., to retire the Memorial Resource Development revolver and to fund additional liquidity at MRD, including a debt service reserve.
The issuer is a Houston-based upstream master limited partnership focused on the acquisition, production and development of oil and gas properties in the United States.
| Issuer: | Memorial Resource Development LLC and Memorial Resource Finance Corp.
|
| Face amount: | $350 million
|
| Proceeds: | $343 million
|
| Maturity: | Dec. 15, 2018
|
| Securities: | Senior PIK toggle notes
|
| Bookrunners: | Citigroup Global Markets Inc., BMO Capital Markets, Wells Fargo Securities LLC
|
| Co-managers: | BofA Merrill Lynch, Barclays, BBVA Securities Inc., Capital One Securities, Comerica Securities, Credit Agricole CIB, J.P. Morgan Securities LLC, ING, Natixis, RBC Capital Markets LLC, RBS Securities Inc., U.S. Bancorp Investments Inc., Mitsubishi UFJ Securities
|
| Cash coupon: | 10%
|
| PIK coupon: | 10¾%
|
| Price: | 98
|
| Cash yield: | 10.524%
|
| Spread: | 897 bps
|
| Call features: | Make-whole call at Treasuries plus 50 bps until Dec. 15, 2014 then callable at 102, 101, par on and after Dec. 15, 2016
|
| Equity clawback: | Up to 100% at 102 until Dec. 15, 2014
|
| Change-of-control put: | 101%
|
| Trade date: | Dec. 13
|
| Settlement date: | Dec. 18
|
| Ratings: | Moody's: B3
|
| Standard & Poor's: B-
|
| Distribution: | Rule 144A and Regulation S for life
|
| Price talk: | 10% cash coupon, 10¾% PIK coupon at 98
|
| Marketing: | Roadshow
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