Published on 6/18/2013 in the Prospect News High Yield Daily.
New Issue: Brookfield prices upsized $500 million nine-year notes at par to yield 6 1/8%
By Paul A. Harris
Portland, Ore., June 18 - Brookfield Residential Properties Inc. and Brookfield Residential U.S. Corp. priced an upsized $500 million issue of nine-year senior notes (B2/BB-/) at par to yield 6 1/8% on Tuesday, according to a syndicate source.
The deal was upsized from $400 million.
The yield printed on top of yield talk that was tightened from earlier talk in the 6¼% area. Initial guidance was in the low 6% range, according to a trader.
Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and Wells Fargo Securities, LLC were the joint bookrunners for the quick-to-market deal.
The Calgary, Alta.-based land developer and homebuilder plans to use the proceeds to refinance debt and add cash to its balance sheet.
| Issuer: | Brookfield Residential Properties Inc. and Brookfield Residential US Corp.
|
| Amount: | $500 million, increased from $400 million
|
| Maturity: | July 1, 2022
|
| Securities: | Senior notes
|
| Bookrunners: | Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Wells Fargo Securities, LLC
|
| Co-managers: | CIBC World Markets Corp., HSBC Securities (USA) Inc., J.P. Morgan Securities LLC, RBC Capital Markets LLC, Scotia Capital (USA) Inc., TD Securities (USA) LLC
|
| Coupon: | 6 1/8%
|
| Price: | Par
|
| Yield: | 6 1/8%
|
| Spread: | 413 bps
|
| Call features: | Make-whole call at Treasuries plus 50 bps until July 1, 2017, then callable at 104.594, 103.063, 101.531, par on and after July 1, 2020
|
| Equity clawback: | 35% at 106.125 until July 1, 2016
|
| Trade date: | June 18
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| Settlement date: | June 25
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| Ratings: | Moody's: B2
|
| Standard & Poor's: BB-
|
| Distribution: | Rule 144A for life and Regulation S
|
| Price talk: | 6 1/8%, revised from 6¼% area
|
| Marketing: | Quick to market
|
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