Axalta Coating sets talk on $875 million eight-year dollar, euro notes

By Paul Deckelman

New York, Aug. 1 – Axalta Coating Systems Ltd. is expected to price $875 million of dollar- and euro-denominated eight-year senior notes (B2/B+) on Tuesday, high yield syndicate sources said.

The company set price talk on its issue on Monday, the sources said, with the dollar-denominated portion of the deal in the 5% area, while the euro-denominated tranche was talked in a 4.25% to 4.5% range.

Tranche sizes on the deal will be announced.

The order books on the deal are scheduled to close at 9 a.m. ET on Tuesday, with pricing expected thereafter.

The deal will be brought to market via left bookrunner Barclays Capital Inc., which will handle billing and delivery, plus bookrunners Deutsche Bank Securities Inc., Goldman Sachs & Co., Bank of America Merrill Lynch, Citigroup Global Markets, Inc., Credit Suisse Securities (USA) LLC and J.P. Morgan Securities LLC.

PNC Capital Markets LLC and SunTrust Robinson Humphrey Inc. will be the co-managers.

The notes come with three years of call protection, a three-year equity clawback provision allowing redemption of up to 40% of the notes at par plus the coupon, and a change of control 101% put option.

The company, a Philadelphia-based provider of paints, varnishes and other coatings systems for various industrial applications, plans to use the new-deal proceeds to refinance its 7 3/8% senior notes due 2021 and for payment of related fees and expenses and general corporate purposes, including adding cash to the company’s balance sheet.

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