Published on 11/10/2015 in the Prospect News Investment Grade Daily.
New Issue: Zoetis details $1.25 billion sale of notes in five-, 10-year tranches
By Aleesia Forni
Virginia Beach, Nov. 10 – Zoetis Inc. detailed its $1.25 billion offering of senior notes in an FWP filed with the Securities and Exchange Commission.
Monday’s sale (Baa2/BBB-) included a $500 million tranche of 3.45% five-year notes that sold at 99.868 to yield 3.479%, or 173 basis points over Treasuries.
Guidance was in the 175 bps area over Treasuries following the 195 bps area over Treasuries talk.
Also, a $750 million piece of 4.5% 10-year bonds priced at 218 bps over Treasuries. Pricing was at 99.769 to yield 4.529%.
The issue came at the tight end of the Treasuries plus 220 bps area guidance and tighter than initial talk set in the Treasuries plus 240 bps area.
BofA Merrill Lynch, Barclays, Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, BNP Paribas Securities Corp., HSBC Securities (USA) Inc. and RBC Capital Markets LLC are the bookrunners.
Proceeds will be used to repay amounts drawn under a revolving credit facility to fund the $765 million purchase price of Salar Topco AS, to repay $400 million of 1.15% senior notes due 2016 and for general corporate purposes.
Zoetis is an animal health subsidiary of Pfizer Inc., based in New York City.
| Issuer: | Zoetis Inc.
|
| Issue: | Senior notes
|
| Amount: | $1.25 billion
|
| Bookrunners: | BofA Merrill Lynch, Barclays, Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, BNP Paribas Securities Corp., HSBC Securities (USA) Inc., RBC Capital Markets LLC
|
| Co-managers: | TD Securities (USA) LLC, Deutsche Bank Securities Inc., Rabo Securities USA Inc., Standard Chartered Bank, Loop Capital Markets LLC
|
| Trade date: | Nov. 9
|
| Settlement date: | Nov. 13
|
| Change-of-control put: | 101%
|
| Ratings: | Moody’s: Baa2
|
| Standard & Poor’s: BBB-
|
| Distribution: | SEC registered
|
|
|
| Five-year notes
|
| Amount: | $500 million
|
| Maturity: | Nov. 13, 2020
|
| Coupon: | 3.45%
|
| Price: | 99.868
|
| Yield: | 3.479%
|
| Spread: | Treasuries plus 173 bps
|
| Price guidance: | Treasuries plus 175 bps area, tightened from Treasuries plus 195 bps area
|
| Make-whole call: | Treasuries plus 30 bps prior to Oct. 13, 2020, then callable at par
|
|
|
| 10-year notes
|
| Amount: | $750 million
|
| Maturity: | Nov. 30, 2025
|
| Coupon: | 4.5%
|
| Price: | 99.769
|
| Yield: | 4.529%
|
| Spread: | Treasuries plus 218 bps
|
| Price guidance: | Treasuries plus 220 bps area, tightened from Treasuries plus 240 bps area
|
| Make-whole call: | Treasuries plus 35 bps prior to Aug. 13, 2025, then callable at par
|
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