By Paul Deckelman
New York, July 28 – Subsidiaries of NXP Semiconductors NV priced a $500 million add-on to the company’s existing 4 1/8% senior notes due 2021 (Ba2/BB+) on Thursday, high-yield primary market sources said.
The add-on priced at 101.875 to yield 3.697%.
Price talk had been in the 101.75 area.
The notes’ official issuers are subsidiaries NXP BV and NXP Funding LLC.
The quickly shopped transaction came to market via underwriter Barclays just hours after the prospective deal was announced.
The notes are being issued under Rule 144A and Regulation S for life.
The securities are immediately fungible with the existing 4 1/8% notes and will carry the same terms, including an investment-grade covenant package, consistent with the company’s existing senior notes due 2021 and 2022.
Like the original notes, the new notes will be non-callable for the life of the issue, other than via a make-whole call at 50 basis points over Treasuries.
Holders will be able to put the notes back to the company at 101% of face value in the event of a change of control.
NXP plans to use the proceeds from the add-on issue to repay the $200 million of 3½% senior notes scheduled to come due on Sept. 15 that remain outstanding from the $500 million of those notes issued in September of 2013. The company redeemed another $100 million of those 2016 notes earlier this year, using surplus cash on hand.
The company plans to use the leftover proceeds from Thursday’s add-on deal for general corporate purposes.
NXP – a semiconductor manufacturer based in Eindhoven, the Netherlands – originally sold $850 million of 4 1/8% notes due June 1, 2021 in a quick-to-market transaction that priced at par via NXP BV and NXP Funding back on May 18.
The company also sold $900 million of 4 5/8% senior notes due 2023 at that time.
The overall May transaction was upsized to $1.75 billion from an originally announced $1 billion.
| Issuers: | NXP BV/NXP Funding LLC (subsidiaries of NXP Semiconductors NV)
|
| Amount: | $500 million
|
| Maturity: | June 1, 2021
|
| Security description: | Immediately fungible add-on to existing 4 1/8% senior notes due June 1, 2021
|
| Bookrunner: | Barclays
|
| Coupon: | 4 1/8%
|
| Price: | 101.875
|
| Yield: | 3.697%
|
| Spread: | 262 bps over 1 3/8% U.S. Treasuries due May 31, 2021
|
| Call protection: | Non-callable, other than via make-whole call at Treasuries plus 50 bps
|
| Change-of-control put: | 101%
|
| Trade date: | July 28
|
| Settlement date: | Aug. 1 (T+2)
|
| Ratings: | Moody’s: Ba2
|
| S&P: BB+
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| Distribution: | Rule 144A and Regulation S for life
|
| Price talk: | 101.75 area
|
| Marketing: | Quick to market
|
| Original issue: | $850 million at par on May 18
|
| Total issue size: | $1.35 billion
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