By Paul Deckelman
New York, Aug. 13 - Sirius XM Radio Inc. priced a $257 million offering of 9¾% six-year senior secured notes due Sept. 1, 2015 (Caa2/B+) at 97.248 to yield 10 3/8% on Thursday, according to high yield syndicate sources.
The issue priced in the middle of pre-deal market price talk calling for a yield of 10¼% to 10½%, and also in line with market expectations of between 2 and 3 points of original issue discount.
The slight upsizing of the bond issue to $257 million allowed Sirius to reap proceeds of just under $250 million, the size of the deal which the company had announced late Wednesday.
The new bonds were sold under Rule 144A for life and Regulation S.
They will have call protection for the first three years after issue.
The deal was brought to market via bookrunner J.P. Morgan Securities, Inc., along with co-managers Morgan Stanley & Co. Inc. and UBS Investment Bank.
New York-based Sirius XM, now the sole provider of satellite radio broadcasting service to the listening public, said that it plans to use the proceeds from the bond deal to repay certain debt incurred under its credit agreement with Liberty Media Corp., which agreed earlier this year to invest some $530 million in Sirius, in return for an equity interest, allowing Sirius to avoid defaulting on an issue of convertible notes that were coming due in mid-February.
| Issuer: | Sirius XM Radio Inc.
|
| Security description: | Senior secured notes
|
| Amount: | $257 million (upsized from $250 million)
|
| Proceeds: | $249, 927,360
|
| Maturity: | Sept. 1, 2015
|
| Bookrunner: | J.P. Morgan Securities, Inc.
|
| Co-managers: | Morgan Stanley & Co. Inc. and UBS Investment Bank
|
| Coupon: | 9¾%
|
| Price: | 97.248
|
| Yield: | 10 3/8%
|
| Spread: | 746 bps
|
| Call features: | Make-whole call at Treasuries plus 50 bps prior to Sept. 1, 2012, then callable at 104.875; callable Sept. 1, 2013 at 102.438; finally callable on or after Sept. 1, 2014 at par.
|
| Equity clawback: | For up to 35% of issue at 109.75 until Sept. 1, 2012
|
| Trade date: | Aug. 13
|
| Settlement date: | Aug. 24
|
| Ratings: | Moody's: Caa2
|
| S&P: B+
|
| Distribution: | Rule 144A for life/Regulation S
|
| Price talk: | 10¼% to 10½%, with 2 to 3 points of OID
|
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