O-I Glass talks $500 million eight-year green notes in 7 3/8% area; pricing Friday

By Paul A. Harris

Portland, Ore., May 11 – O-I Glass, Inc. talked the Owens-Brockway Glass Container Inc. (OBGC) $500 million offering of eight-year senior green notes (B2/B+) in the 7 3/8% area, inside of earlier guidance in the mid-to-high 7% area, according to market sources.

The notes become callable after three years at par plus 50% of the coupon.

Wells Fargo Securities LLC is the left lead.

Meantime official talk on the concurrent OI European Group BV (OIEG) €500 million tranche of five-year senior green notes (Ba3/BB-) remained pending heading into the Thursday New York close, sources said.

Initial guidance in the mid-to-high 6% area was announced earlier in the day.

The euro-denominated five-year notes become callable in two years at par plus 50% of the coupon.

JPMorgan is the left lead for the euro-denominated notes.

Both issuers are indirect wholly owned subsidiaries of O-I Glass. However, the OIEG euro-denominated notes come with guarantees which render them superior in credit quality to the OBGC dollar notes.

Both tranches are expected to price on Friday.

Managing both tranches of the Rule 144A and Regulation S for life offering will be global coordinators and joint bookrunners Wells Fargo, JPMorgan and Credit Agricole.

BNP Paribas, BofA, Deutsche Bank, Goldman Sachs, Mizuho, Rabobank and Scotiabank are also joint bookrunners for both tranches.

Proceeds from both tranches plus cash on hand will be used to fund tender offers for $250 million of outstanding OBGC 5 7/8% senior notes due 2023 and €725 million of OIEG 3 1/8% senior notes due 2024.

O-I Glass intends to allocate an amount equal to the net proceeds to finance and/or refinance new and/or existing eligible green projects as defined in its Green Financing Framework.

Credit Agricole is the lead green structuring agent.

O-I Glass, formerly Owens-Illinois, Inc., is a container glass manufacturer based in Perrysburg, Ohio.

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