MTS Systems to begin marketing $300 million eight-year notes on Tuesday

By Paul A. Harris

Portland, Ore., July 8 – MTS Systems Corp. plans to kick off a $300 million offering of eight-year senior notes (B3/B+) at a New York City investor lunch and conference call both set to get underway at 12:30 p.m. ET on Tuesday, according to market sources.

Pricing is expected later in the July 8 week.

Initial guidance has the deal coming to yield in the 6¼% area, a trader said.

Wells Fargo Securities LLC is the left bookrunner. J.P. Morgan Securities LLC is the joint bookrunner.

HSBC Securities (USA) Inc., BofA Securities Inc. and U.S. Bancorp Investments Inc. are the co-managers.

The Rule 144A and Regulation S for life notes become callable after three years at par plus 50% of the coupon.

The Eden Prairie, Minn.-based supplier of test systems and industrial position sensors plans to use the proceeds to fully pay down outstanding amounts on its revolving credit facility and partially pay down its term loan B.

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