By Paul A. Harris
Portland, Ore., June 30 – Victoria’s Secret & Co. priced an upsized $600 million issue of eight-year senior notes (B1/B+) at par to yield 4 5/8% on Wednesday, according to market sources.
The issue size increased from $500 million with the shift of $100 million of proceeds from a concurrent bank loan.
The yield printed 12.5 basis points tighter than the 4¾% to 5% yield talk. Initial guidance was in the 5% area.
The bond deal was heard to have been almost fully subscribed by the process of reverse inquiry.
Timing was accelerated, as the offer had previously been expected to remain in the market until Thursday.
J.P. Morgan Securities LLC was the lead.
The Columbus, Ohio-based specialty fashion retailer is a subsidiary of L Brands, Inc., which is spinning Victoria's Secret off to shareholders.
Proceeds will be used to fund a portion of the cash payment to L Brands with respect to the spinoff.
Prior to the closing of the spinoff, the proceeds will be placed in escrow.
The shift of proceeds to the bonds from the loan saw Victoria's Secret's term loan decrease to $400 million from $500 million.
| Issuer: | Victoria's Secret & Co.
|
| Amount: | $600 million, increased from $500 million
|
| Maturity: | July 15, 2029
|
| Securities: | Senior notes
|
| Lead: | J.P. Morgan Securities LLC
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| Coupon: | 4 5/8%
|
| Price: | Par
|
| Yield: | 4 5/8%
|
| Spread: | 332 bps
|
| Call protection: | Three years
|
| Trade date: | June 30
|
| Ratings: | Moody's: B1
|
| S&P: B+
|
| Distribution: | Rule 144A and Regulation S
|
| Price talk: | 4¾% to 5%
|
| Marketing: | Roadshow
|
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