BBA Aviation to price $650 million 8.25-year notes on Tuesday; early guidance mid-4% area

By Paul A. Harris

Portland, Ore., Oct. 28 – London-based BBA Aviation plc plans to price a $650 million offering of 8.25-year senior notes (existing ratings Ba2/BB) on Tuesday, according to market sources.

An investor conference call was scheduled to get underway at 12:30 p.m. ET on Monday.

Initial guidance has the deal coming to yield in the mid-4% area, a trader said.

BofA Securities Inc. is the left bookrunner. Barclays, HSBC, J.P. Morgan Securities LLC, NatWest Investments, SMBC Nikko and SunTrust Robinson Humphrey are the joint bookrunners.

The Rule 144A and Regulation S notes become callable after 3.25 years at par plus 50% of the coupon. The notes also feature a 40% equity clawback at par plus the coupon during the non-call period and a 101% poison put.

The issuing entity will be BBA U.S. Holdings, Inc.

The London-based aviation services company plans to use the proceeds, together with a portion ($250 million) of the proceeds from the anticipated sale of the Ontic business, to prepay debt under its facility C term loan and 2019 term loan, and to pay down its revolver

In late July 2019, BBA Aviation announced it had reached an agreement to sell Ontic, a provider of OEM-licensed parts for legacy aerospace platforms, to CVC Fund VII, for an enterprise value of $1,365,000,000.

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