Arch Coal to price $500 million seven-year senior notes on Tuesday

By Paul A. Harris

St. Louis, July 27 - Arch Coal Inc. plans to price a $500 million issue of seven-year senior notes on Tuesday, according to an informed source.

Bank of America Merrill Lynch, Citigroup, Morgan Stanley and JP Morgan are joint bookrunners for the Rule 144A with registration rights deal.

PNC Capital Markets is the lead manager. Wachovia Securities, Calyon Securities, US Bancorp, RBS Securities Inc., BMO Securities, Mizuho Securities, Regions Capital Markets, Sovereign Bank Capital Markets, Bank of New York, Natixis Bleichroder and Credit Suisse are co-managers.

The notes will come with four years of call protection.

Credit ratings remain to be determined.

Proceeds, together with a 17 million share offer (expected to raise approximately $300 million), will be used to fund the acquisition of the Jacobs Ranch mining complex.

The issuer is a St. Louis-based coal producer.

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