By Paul A. Harris
Portland, Ore., April 29 – Miller Homes ended an issuance drought in the European high-yield bond market stretching back more than 10 weeks on Friday as it priced £815 million equivalent of senior secured notes (B1/B+/BB-) in two tranches, according to market sources.
The deal featured a £425 million tranche of 7% seven-year fixed-rate notes that priced at 93.45 to yield 8¼%.
The yield printed at the wide end of the 8% to 8¼% yield talk, and wide of initial guidance in the high 7% area.
Miller Homes also priced a €465 million tranche of Euribor plus 525 basis points six-year floating-rate notes, with no Euribor floor, at 97. The spread and floor come on top of both official talk and initial guidance. The issue price came at the cheap end of the 97 to 98 price talk. Initial price guidance was 98.
Barclays and HSBC were the joint global coordinators. Bookrunners were Credit Suisse, Deutsche Bank, Goldman Sachs International, Lloyds Bank Corporate Markets, RBC Capital Markets and Standard Chartered Bank.
The issuing entity was Castle UK Finco plc, the indirect parent of Miller Homes.
The Edinburgh-based home builder plans to use the proceeds to pay off the bridge loan put in place to fund the buyout of Miller Homes by Apollo and Miller Homes management from Bridgepoint Group plc.
| Issuer: | Castle UK Finco plc
|
| Amount: | £815 million equivalent
|
| Issue: | Senior secured notes
|
| Global coordinators: | Barclays, HSBC
|
| Bookrunners: | Credit Suisse, Deutsche Bank, Goldman Sachs International, Lloyds Bank Corporate Markets, RBC Capital Markets and Standard Chartered Bank
|
| Trade date: | April 29
|
| Ratings: | Moody's: B1
|
| S&P: B+
|
| Fitch: BB-
|
| Distribution: | Rule 144A and Regulation S
|
|
|
| Fixed-rate notes
|
| Amount: | £425 million
|
| Tenor: | Seven years
|
| Bill and deliver: | HSBC
|
| Coupon: | 7%
|
| Price: | 93.45
|
| Yield: | 8¼%
|
| Call protection: | Three years
|
| Price talk: | 8% to 8¼%
|
|
|
| Floating-rate notes
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| Amount: | €465 million
|
| Tenor: | Six years
|
| Coupon: | Euribor plus 525 bps
|
| Floor: | 0%
|
| Price: | 97
|
| Call protection: | One year
|
| Price talk: | Euribor plus 525 bps, 0% floor, at 97 to 98
|
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