Published on 9/17/2020 in the Prospect News High Yield Daily.
New Issue: Michaels prices downsized $375 million seven-year notes at par to yield 4¾%
By Paul A. Harris
Portland, Ore., Sept. 17 – Michaels Stores, Inc. priced a downsized $375 million issue of seven-year senior secured notes (Ba3/B+) at par to yield 4¾% on Thursday, according to market sources.
The issue size decreased from $500 million.
The yield printed at the tight end of yield talk in the 4 7/8% area, and deep inside of initial guidance in the 5¼% to 5½% area.
J.P. Morgan Securities LLC, Wells Fargo Securities, LLC, BofA Securities Inc., Truist Securities, Inc., Goldman Sachs & Co. LLC, Barclays, Citizens Capital Markets Inc., U.S. Bancorp Investments Inc., BMO Capital Markets Corp., Fifth Third Securities Inc., Credit Suisse Securities (USA) LLC and UBS Securities LLC were the joint bookrunners.
The Irving, Tex.-based retailer of arts and crafts supplies plans to use the proceeds, together with proceeds from a proposed term loan and cash on hand, to refinance its existing term loan.
| Issuer: | Michaels Stores, Inc.
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| Amount: | $375 million, decreased from $500 million
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| Maturity: | Oct. 1, 2027
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| Securities: | Senior secured notes
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| Bookrunners: | J.P. Morgan Securities LLC, Wells Fargo Securities, LLC, BofA Securities Inc., Truist Securities, Inc., Goldman Sachs & Co. LLC, Barclays, Citizens Capital Markets Inc., U.S. Bancorp Investments Inc., BMO Capital Markets Corp., Fifth Third Securities Inc., Credit Suisse Securities (USA) LLC and UBS Securities LLC
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| Coupon: | 4¾%
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| Price: | Par
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| Yield: | 4¾%
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| Spread: | 428 bps
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| Call protection: | Three years
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| Trade date: | Sept. 17
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| Settlement date: | Oct. 1
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| Ratings: | Moody's: Ba3
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| S&P: B+
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| Distribution: | Rule 144A and Regulation S for life
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| Price talk: | 4 7/8% area
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| Marketing: | Drive-by
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