By Paul A. Harris
Portland, Ore., Aug. 6 – Warner Music Group's WMG Acquisition Corp. priced a $550 million issue of 10.5-year senior secured notes (Ba3/BB) at par to yield 3% in a Thursday drive-by, according to market sources.
The yield printed at the tight end of the 3% to 3¼% yield talk. Initial guidance had the deal coming to yield in the low-to-mid 3% area.
Credit Suisse Securities (USA) LLC was the left lead bookrunner. Joint bookrunners were BofA Securities Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC.
The New York-based entertainment company plans to use the proceeds to pay down term loans under its senior term loan facility with the remainder, if any, for general corporate purposes.
| Issuer: | WMG Acquisition Corp.
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| Amount: | $550 million
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| Maturity: | Feb. 1, 2031
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| Securities: | Senior secured notes
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| Left bookrunner: | Credit Suisse Securities (USA) LLC
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| Joint bookrunners: | BofA Securities Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC
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| Coupon: | 3%
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| Price: | Par
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| Yield: | 3%
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| Spread: | 248 bps
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| First call: | Feb. 15, 2026 at 101.5
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| Special call: | Issuer may redeem 10% of notes annually at 103 during non-call period
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| Equity clawback: | 40% at 103 until Aug. 15, 2023
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| Trade date: | Aug. 6
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| Settlement date: | Aug. 12
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| Ratings: | Moody's: Ba3
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| S&P: BB
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| Distribution: | Rule 144A and Regulation S
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| Price talk: | 3% to 3¼%
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| Marketing: | Drive-by
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