Sunstate talks $170 million six-year notes with 11%-11¼% yield

By Paul A. Harris

Portland, Ore., May 26 - Sunstate Equipment Co. LLC and Sunstate Equipment Co. Inc. talked their $170 million offering of six-year senior secured second-lien notes (Caa2/CCC+) with an 11% to 11¼% yield on Thursday, according to an informed source.

The deal is expected to price on Friday.

Bank of America Merrill Lynch is the bookrunner for the Rule 144A for life offering.

The notes come with three years of call protection and feature a 101% poison put.

Proceeds, together with proceeds from a new credit facility, will be used to refinance the company's 10½% second-lien notes due 2013 and to repay a portion of its existing credit facility.

Sunstate is a Phoenix-based company that provides construction, industrial and special-event companies with rental tools and equipment.

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