By Paul A. Harris
Portland, Ore., Dec. 2 – Grinding Media Inc. and MC Grinding Media (Canada) Inc. priced an upsized $775 million issue of seven-year senior secured notes (B2/B), which back the acquisition of Moly-Cop, at par to yield 7 3/8% on Friday, according to a syndicate source.
The issue size was increased from $725 million.
The yield printed 12.5 basis points below the tight end of the 7½ to 7¾% yield talk.
Morgan Stanley & Co. LLC, Jefferies & Co., Deutsche Bank Securities Inc. and UBS Investment Bank were the joint bookrunners.
The notes feature a Treasuries plus 50 bps make-whole call until Dec. 15, 2019, then become callable at 103.688. A special call provision allows the issuer to redeem up to 10% of the notes annually at 103 during the non-call period.
On Nov. 4, Arrium signed a share sale agreement with American Industrial Partners, a private equity firm, for the sale of all the entities that make up the Moly-Cop business, according to a Moly-Cop news release which appeared in late October. Under the terms of the agreement the total enterprise value of the Moly-Cop business is $1.23 billion.
The sale is expected to close in early 2017.
Moly-Cop is based in Kansas City, Mo.
| Issuers: | Grinding Media Inc. and MC Grinding Media (Canada) Inc.
|
| Amount: | $775 million, increased from $725 million
|
| Maturity: | Dec. 15, 2023
|
| Securities: | Senior secured notes
|
| Bookrunners: | Morgan Stanley & Co., LLC, Jefferies & Co., Deutsche Bank Securities Inc., UBS Investment Bank
|
| Coupon: | 7 3/8%
|
| Price: | Par
|
| Yield: | 7 3/8%
|
| Spread: | 519 bps
|
| Call: | Make-whole call at Treasuries plus 50 bps until Dec. 15, 2019, then callable at 103.688
|
| Special call: | A special call provision allows the issuer to redeem up to 10% of the notes annually at 103 during the non-call period
|
| Trade date: | Dec. 2
|
| Settlement date: | Dec. 16
|
| Ratings: | Moody's: B2
|
| S&P: B
|
| Distribution: | Rule 144A and Regulation S for life
|
| Price talk: | 7½% to 7¾%
|
| Marketing: | Roadshow
|
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