Published on 7/18/2013 in the Prospect News High Yield Daily.
New Issue: Germany's Schaeffler sells €1.6 billion equivalent notes in two parts
By Paul A. Harris
Portland, Ore., July 18 - Schaeffler Holding Finance BV priced €1.6 billion equivalent of five-year senior secured PIK toggle notes (B2/B-/) on Thursday, according to a market source.
The deal included a $1 billion tranche, which priced at 99.468 to yield 7%, at the tight end of the 7% to 7¼% yield talk.
In addition Schaeffler priced an €800 million tranche of notes at 98.428 to yield 7¼%, at the tight end of the 7¼% to 7½% yield talk.
Both the dollar-denominated notes and the euro-denominated notes pay a cash coupon of 6 7/8% and a PIK coupon of 7 5/8%.
J.P. Morgan Securities LLC will bill and deliver for the dollar tranche and was a joint bookrunner, while Deutsche Bank Securities Inc. will bill and deliver for the euro tranche and was also a joint bookrunner.
BNP Paribas Securities Corp., Citigroup Global Markets Inc., Commerzbank, HSBC Securities and UniCredit were additional joint bookrunners.
Proceeds will be used to refinance existing holding company debt.
The issuer is a Herzogenaurach, Germany-based manufacturer of bearings for the automobile and industrial equipment sectors.
| Issuer: | Schaeffler Holding Finance BV
|
| Amount: | €1.6 billion equivalent
|
| Maturity: | Aug. 15, 2018
|
| Security description: | Senior secured PIK toggle notes
|
| Bookrunners: | JPMorgan, Deutsche Bank, BNP Paribas, Citigroup, Commerzbank, HSBC, UniCredit Bank
|
| Change-of-control put: | 101%
|
| Trade date: | July 18
|
| Settlement date: | July 24
|
| Ratings: | Moody's: B2
|
| Standard & Poor's: B-
|
| Distribution: | Rule 144A and Regulation S for life
|
| Marketing: | Roadshow
|
|
|
| Dollar tranche
|
| Face amount: | $1 billion
|
| Proceeds: | $995 million
|
| Cash coupon: | 6 7/8%
|
| PIK coupon: | 7 5/8%
|
| Price: | 99.468
|
| Yield: | 7%
|
| Spread: | 555 bps
|
| Call features: | Make-whole call at Treasuries plus 50 bps until Aug. 15, 2014, then callable at 105.156, 103.438, 101.719, par on Aug. 15, 2017
|
| Equity clawback: | 40% at 106.875 until Aug. 15, 2014
|
| Yield talk: | 7% to 7¼%
|
| Bill and deliver: | JPMorgan
|
|
|
| Euro-denominated notes
|
| Face amount: | €800 million
|
| Proceeds: | €787 million
|
| Cash coupon: | 6 7/8%
|
| PIK coupon: | 7 5/8%
|
| Price: | 98.428
|
| Yield: | 7¼%
|
| Spread: | 637 bps
|
| Call features: | Make-whole call at Bunds plus 50 bps until Aug. 15, 2014, then callable at 105.156, 103.438, 101.719, par on and after Aug. 15, 2017
|
| Equity clawback: | 40% at 106.875 Aug. 15, 2014
|
| Yield talk: | 7¼% to 7½%
|
| Bill and deliver: | Deutsche Bank
|
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