TopBuild driving by with $500 million senior notes due February 2032; initial talk mid-4% area

By Paul A. Harris

Portland, Ore., Sept. 28 – TopBuild Corp. plans to price a $500 million offering of senior notes due February 2032 (existing ratings Ba2/BB+) in a Tuesday drive-by trailing a conference call with investors, according to market sources.

Initial guidance has the notes coming to yield in the mid-4% area, according to a bond trader.

BofA Securities Inc., J.P. Morgan Securities LLC, PNC Capital Markets LLC, Fifth Third Securities Inc. and Citizens Capital Markets Inc. are the joint bookrunners.

Capital One Securities Inc., U.S. Bancorp Investments Inc., RBC Capital Markets LLC and Regions Securities LLC are the co-managers.

The Rule 144A and Regulation S notes, which have a tenor of approximately 10.3 years, become callable after five years at par plus 50% of the coupon. They feature a 40% equity clawback at par plus the full coupon during the non-call period and have a 101% poison put.

The Daytona Beach, Fla.-based installer and distributor of insulation and other building products plans to use the proceeds to partially finance its pending acquisition of DI Super Holdings, Inc., the indirect parent of Distribution International, Inc.

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