Axalta to price $500 million seven-year notes in Monday drive-by; initial talk low 5% area

By Paul A. Harris

Portland, Ore., June 1 – Axalta Coating Systems Ltd. plans to prices a $500 million offering of senior notes due June 2027 (existing ratings B1/BB) in a Monday drive-by following a mid-morning conference call with investors, according to market sources.

Initial price talk has the deal coming to yield in the low 5% area, a trader said.

Joint bookrunner Barclays will bill and deliver. Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Citigroup Global Markets Inc. and SunTrust Robinson Humphrey Inc. are also joint bookrunners.

BofA Securities Inc., Credit Suisse Securities (USA) LLC and Jefferies LLC are the co-managers.

The Rule 144A for life notes become callable after three years at par plus 50% of the coupon. They feature a three-year 40% equity clawback at par plus the coupon and a 101% poison put.

The issuing entities will be Axalta Coating Systems, LLC (U.S.) and Axalta Coating Systems Dutch Holding B BV (Netherlands), both wholly owned subsidiaries of Axalta Coating Systems.

The Philadelphia-based manufacturer of coatings for light and commercial vehicles, industrial, and refinish applications plans to use the proceeds for general corporate purposes, including debt repayment, capital expenditures, working capital and funding for potential acquisitions.

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