Published on 3/1/2018 in the Prospect News High Yield Daily.
New Issue: AES prices $1 billion senior notes in two tranches
By Paul A. Harris
Portland, Ore., March 1 – AES Corp. priced $1 billion of senior notes (Ba2/BB) in a quick-to-market two-part Thursday deal, according to market sources.
The deal included $500 million of three-year bullet notes, which priced at par to yield 4%. The yield printed in the middle of both yield talk and initial guidance in the 4% area.
AES also priced $500 million of five-year notes at par to yield 4½%. Again, the yield printed in the middle of both yield talk and initial guidance in the 4½% area.
Morgan Stanley & Co. LLC, Barclays, BofA Merrill Lynch, Citigroup Global Market Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC and MUFG were the joint bookrunners.
The Arlington, Va.-based power company plans to use the proceeds to fund tender offers for its 8% senior notes due 2020 and 7 3/8% senior notes due 2021.
| Issuer: | AES Corp.
|
| Amount: | $1 billion
|
| Securities: | Senior notes
|
| Bookrunners: | Morgan Stanley & Co. LLC, Barclays, BofA Merrill Lynch, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC and MUFG
|
| Co-managers: | BNP Paribas Securities Corp., Credit Agricole CIB, HSBC Securities (USA) Inc., KeyBanc Capital Markets, Mizuho Securities USA Inc., Ramirez, SG CIB, SMBC Nikko
|
| Trade date: | March 1
|
| Settlement date: | March 15
|
| Ratings: | Moody's: Ba2
|
| S&P: BB
|
| Distribution: | SEC registered
|
| Marketing: | Quick to market
|
|
|
| Three-year notes
|
| Amount: | $500 million
|
| Maturity: | March 15, 2021
|
| Coupon: | 4%
|
| Price: | Par
|
| Yield: | 4%
|
| Spread: | 164 bps
|
| Call protection: | Make-whole call at Treasuries plus 50 bps
|
| Price talk: | 4% area
|
|
|
| Five-year notes
|
| Amount: | $500 million
|
| Maturity: | March 15, 2023
|
| Coupon: | 4½%
|
| Price: | Par
|
| Yield: | 4½%
|
| Spread: | 193 bps
|
| Call protection: | Make-whole call at Treasuries plus 50 bps before March 15, 2020, then at 102.25
|
| Equity clawback: | For up to 35% at 104.5 until March 15, 2020
|
| Price talk: | 4½% area
|
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