Published on 5/16/2016 in the Prospect News High Yield Daily.
New Issue: Aramark prices $1 billion senior notes in two tranches
By Paul A. Harris
Portland, Ore., May 16 – Aramark Services, Inc. priced $1 billion of senior notes (B2/BB-) in two tranches on Monday, according to a syndicate source.
The Philadelphia-based company priced a $500 million add-on to its 5 1/8% senior notes due Jan. 15, 2024 at 103.75 to yield 4.364%. The reoffer price came rich to price talk in the 103.5 area; early guidance was also in the 103.5 area.
In addition Aramark priced $500 million of new 10-year senior notes at par to yield 4¾%. The yield came at the tight end of the 4¾% to 5% yield talk. Early guidance had the new notes pricing to yield in the high 4% to 5% yield context.
Wells Fargo Securities LLC was the left bookrunner. BofA Merrill Lynch, Barclays, Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC, Goldman Sachs & Co. and Morgan Stanley & Co. LLC were the joint bookrunners.
Proceeds will be used to redeem $771.2 million of the company’s $1 billion of 5¾% senior notes due 2020 and to repay about $192.8 million of term loans under the senior secured credit facilities.
Aramark is a customer service business across food, facilities and uniforms sectors.
| Issuer: | Aramark
|
| Amount: | $1 billion
|
| Securities: | Senior notes
|
| Bookrunners: | Wells Fargo Securities LLC, BofA Merrill Lynch, Barclays, Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC, Goldman Sachs & Co., Morgan Stanley & Co. LLC
|
| Co-managers: | SMBC Nikko Capital Markets Ltd., Rabo Securities USA Inc., TD Securities (USA) LLC, PNC Capital Markets LLC, Santander Investment Securities Inc., Comerica Securities Inc.
|
| Trade date: | May 16
|
| Settlement date: | May 31
|
| Ratings: | Moody's: B2
|
| Standard & Poor's: BB-
|
| Distribution: | Rule 144A and Regulation S with registration rights
|
| Marketing: | Quick to market
|
|
|
| Add-on notes
|
| Face amount: | $500 million
|
| Proceeds: | $518.75 million
|
| Maturity: | Jan. 15, 2024
|
| Security description: | Add-on to 5 1/8% senior notes due Jan. 15, 2024
|
| Coupon: | 5 1/8%
|
| Price: | 103.75
|
| Yield: | 4.364%
|
| Spread: | 299 bps
|
| First call: | Callable Jan. 15, 2019 at 103.863
|
| Price talk: | 103.5
|
| Original issue: | $400 million priced at par on Dec. 3, 2015
|
|
|
| New senior notes
|
| Amount: | $500 million
|
| Maturity: | June 1, 2026
|
| Coupon: | 4¾%
|
| Price: | Par
|
| Yield: | 4¾%
|
| Spread: | 300 bps
|
| First call: | June 1, 2021 at 102.375
|
| Price talk: | 4¾% to 5%
|
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