Sabic downsized $1.5 billion eight-year notes guided for 10¼% yield

By Paul A. Harris and Sara Rosenberg

St. Louis, Aug. 14 - Sabic Innovative Plastics Holding BV set the price guidance for its downsized $1.5 billion offering of eight-year senior unsecured notes (B1/B+) on Tuesday, according to an informed source.

The notes are expected to price with a 10¼% yield and are likely to be priced at a discount. Hence the issue price and coupon remain to be determined.

Pricing is expected on Monday.

The bond offering initially came to market as a $2.765 billion equivalent offering of eight-year notes in tranches of $1.95 billion and €590 million. The proposed euro-denominated notes have been withdrawn.

With the downsizing of the bonds, the bank deal has been upsized to $6.65 billion from $5.40 billion.

A sellside source, not in the deal, said that both the bond and bank deals were "basically done," meaning that the debt has essentially already been placed.

An informed source who heard this did not take issue with that assertion and told Prospect News on Tuesday that much of the demand for both the bond paper and the loan paper is from Middle Eastern institutions, with European accounts and a smattering of U.S. accounts also expected to be in the deal.

Citigroup, ABN Amro, GE Capital, HSBC and JP Morgan are joint bookrunners for the Rule 144A with registration rights notes.

Proceeds will be used to help fund the acquisition General Electric's plastics business by Saudi Basic Industries Corp. (Sabic) for $11.6 billion, including the assumption of liabilities.

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