Published on 9/16/2015 in the Prospect News Investment Grade Daily.
New Issue: AutoNation sells upsized $750 million of senior notes in two tranches
By Aleesia Forni
Virginia Beach, Sept. 16 – AutoNation Inc. priced an upsized $750 million issue of senior notes (Baa3/BBB-) in two tranches on Wednesday, according to a market source an FWP filed with the Securities and Exchange Commission.
There was $300 million of 3.35% notes due Jan. 15, 2021 sold at 99.998 to yield 3.351% with a spread of Treasuries plus 175 basis points.
A $450 million 4.5% note due Oct. 1, 2025 sold at 99.663 to yield 4.542%, or Treasuries plus 225 bps.
Both tranches sold at the tight end of revised guidance.
BofA Merrill Lynch, J.P. Morgan Securities LLC, Wells Fargo Securities LLC and SunTrust Robinson Humphrey Inc. are the bookrunners.
Proceeds will be used to reduce borrowings under a revolving credit facility and for general corporate purposes.
The automotive retailer is based in Fort Lauderdale.
| Issuer: | AutoNation Inc.
|
| Issue: | Senior notes
|
| Amount: | $750 million, upsized form $600 million
|
| Bookrunners: | BofA Merrill Lynch, J.P. Morgan Securities LLC, Wells Fargo Securities LLC, SunTrust Robinson Humphrey Inc.
|
| Lead managers: | MUFG, Mizuho Securities USA Inc.
|
| Co-managers: | BB&T Capital Markets, a division of BB&T Securities, LLC, BBVA Securities Inc., Comerica Securities, Inc., Fifth Third Securities, Inc., KeyBanc Capital Markets Inc., Regions Securities LLC, TD Securities (USA) LLC, U.S. Bancorp Investments, Inc.
|
| Trade date: | Sept. 16
|
| Settlement date: | Sept. 21
|
| Change-of-control put: | 101%
|
| Ratings: | Moody’s: Baa3
|
| Standard & Poor’s: BBB-
|
| Distribution: | SEC registered
|
|
|
| Five-year notes
|
| Amount: | $300 million
|
| Maturity: | Jan. 15, 2021
|
| Coupon: | 3.35%
|
| Price: | 99.998
|
| Yield: | 3.351%
|
| Spread: | Treasuries plus 175 bps
|
| Price guidance: | Treasuries plus 180 bps area, revised from 190 bps area, tightened from 45 bps below the 10-year tranche
|
| Make-whole call: | Treasuries plus 30 bps prior to Dec. 15, 2020, then callable at par
|
|
|
| 10-year notes
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| Amount: | $450 million
|
| Maturity: | Oct. 1, 2025
|
| Coupon: | 4.5%
|
| Price: | 99.663
|
| Yield: | 4.542%
|
| Spread: | Treasuries plus 225 bps
|
| Price guidance: | Treasuries plus 230 bps area, revised from 240 bps area, tightened from Treasuries plus mid- to high-200 bps area
|
| Make-whole call: | Treasuries plus 35 bps prior to July 1, 2025, then callable at par
|
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