Published on 6/27/2017 in the Prospect News Investment Grade Daily.
New Issue: CBS details upsized $900 million sale of senior notes due 2023, 2028
By Devika Patel
Knoxville, Tenn., June 27 – CBS Corp. offered further details about an upsized $900 million offering of senior notes (Baa2/BBB/BBB) that priced in two tranches on Monday, according to an FWP filed with the Securities and Exchange Commission.
The company priced $400 million of 2.5% notes due Feb. 15, 2023 at a spread of Treasuries plus 85 basis points. These notes priced at 99.426 to yield 2.61%.
And it sold $500 million of 3.375% notes due Feb. 15, 2028 at a Treasuries plus 135 bps spread. These notes priced at 99.027 to yield 3.485%.
The deal was increased from $700 million. Both tranches priced on the tight side of guidance.
BofA Merrill Lynch, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Wells Fargo Securities LLC, BNP Paribas Securities Corp. and SMBC Nikko Securities America, Inc. were the bookrunners.
The notes are guaranteed by CBS Operations Inc., according to a 424B5 filing with the Securities and Exchange Commission.
Proceeds will be used to repay at maturity the company’s $400 million of 1.95% senior notes due July 1, 2017 and for general corporate purposes, including a redemption of some or all of CBS’ $300 million of 4.625% senior notes due May 15, 2018 and the repayment of short-term borrowings, including commercial paper.
CBS is a broadcasting company based in New York.
| Issuer: | CBS Corp.
|
| Guarantor: | CBS Operations Inc.
|
| Amount: | $900 million
|
| Description: | Senior notes
|
| Bookrunners: | BofA Merrill Lynch, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Wells Fargo Securities LLC, BNP Paribas Securities Corp. and SMBC Nikko Securities America, Inc.
|
| Co-managers: | MUFG, RBC Capital Markets Corp., U.S. Bancorp Investments Inc., TD Securities (USA) LLC, SG Americas Securities, LLC, BNY Capital Markets Inc., Academy Securities, Inc., Loop Capital Markets LLC, Samuel A. Ramirez & Co. Inc. and Williams Capital Group LP
|
| Trade date: | June 26
|
| Settlement date: | July 3
|
| Ratings: | Moody’s: Baa2
|
| S&P: BBB
|
| Fitch: BBB
|
| Distribution: | SEC registered
|
|
|
| Ten-year notes
|
| Amount: | $400 million
|
| Maturity: | Feb. 15, 2023
|
| Coupon: | 2.5%
|
| Price: | 99.426
|
| Yield: | 2.61%
|
| Spread: | Treasuries plus 85 bps
|
| Call: | Make-whole call at the greater of par or Treasuries plus 15 bps until Jan. 15, 2023, then a par call
|
| Price guidance: | Treasuries plus 90 bps area, plus or minus 5 bps
|
|
|
| Thirty-year notes
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| Amount: | $500 million
|
| Maturity: | Feb. 15, 2028
|
| Coupon: | 3.375%
|
| Price: | 99.027
|
| Yield: | 3.485%
|
| Spread: | Treasuries plus 135 bps
|
| Call: | Make-whole call at the greater of par or Treasuries plus 25 bps until Nov. 15, 2027, then a par call
|
| Price guidance: | Treasuries plus 140 bps area, plus or minus 5 bps
|
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