By Paul A. Harris
St. Louis, April 30 - Starwood Hotels & Resorts Worldwide, Inc. priced a $500 million issue of 7 7/8% senior notes due Oct. 15, 2014 (Ba1/BB) at 96.285 to yield 8¾% on Thursday, according to an informed source.
The deal, which was Starwood's first issue of junk, was run jointly off of the high-grade and high-yield syndicate desks and played to a lot of demand from investors from both asset classes, according to the source.
Banc of America Securities LLC, J.P. Morgan Securities Inc. and Deutsche Bank Securities Inc. were joint bookrunners.
Proceeds will be used to pay down a revolving credit facility.
The issuer is a White Plains, N.Y.-based hotel and leisure company.
| Issuer: | Starwood Hotels & Resorts Worldwide, Inc.
|
| Face amount: | $500 million
|
| Proceeds: | $481.425 million
|
| Maturity: | Oct. 15, 2014
|
| Security description: | Senior notes
|
| Bookrunners: | Banc of America Securities LLC, J.P. Morgan Securities Inc., Deutsche Bank Securities Inc.
|
| Coupon: | 7 7/8%
|
| Price: | 96.285
|
| Yield: | 8¾%
|
| Spread: | 676.4 bps
|
| Call features: | Non-callable, make-whole provision at Treasuries plus 50 bps
|
| Trade date: | April 30
|
| Settlement date: | May 7
|
| Ratings: | Moody's: Ba1
|
| Standard & Poor's: BB
|
| Price talk: | 8 7/8% area
|
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