Office Depot talks $250 million seven-year secured notes at 9½%-9¾%

By Paul A. Harris

Portland, Ore., March 8 - Office Depot, Inc. talked its $250 million offering of seven-year senior secured notes (B2/B-/) to yield 9½% to 9¾% on Thursday, according to a syndicate source.

The deal is set to price on Friday morning.

Citigroup Global Markets Inc. is the left bookrunner. Bank of America Merrill Lynch, J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and Wells Fargo Securities LLC are joint bookrunners.

The Rule 144A and Regulation S with registration rights notes come with first-lien security and feature standard incurrence-based high-yield covenants.

The notes come with four years of call protection and feature a 101% poison put.

The Boca Raton, Fla.-based supplier of office products and services plans to use the proceeds to fund the tender offer for its 6¼% notes due 2013.

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