By Cristal Cody
Tupelo, Miss., April 5 – Dollar Tree Inc. priced $4 billion of senior notes (Baa3/BBB-/) in four tranches on Thursday, according to a market source and an FWP filing with the Securities and Exchange Commission.
The company priced $750 million of two-year floating-rate notes at par to yield Libor plus 70 basis points.
It sold $1 billion of 3.7% three-year fixed-rate notes at 99.814 to yield 3.74%, or a spread of Treasuries plus 110 bps.
The $1 billion tranche of 4% seven-year notes priced at 99.899 to yield 4.016%, or a Treasuries plus 125 bps spread.
In the final tranche, Dollar Tree sold $1.25 billion of 4.2% 10-year notes at 99.736 to yield 4.232%. The notes priced with a spread of 140 bps over Treasuries.
The notes all came on the tight side of guidance.
J.P. Morgan Securities LLC, BofA Merrill Lynch, Wells Fargo Securities LLC, RBC Capital Markets, LLC, Fifth Third Securities, Inc. and U.S. Bancorp Investments, LLC were the bookrunners.
Proceeds will be used with cash on hand and borrowings under new senior credit facilities to redeem all of the company’s 5.75% senior notes due March 1, 2023 and repay all of its term loan A-1 loans and term loan B-2 loans.
Dollar Tree is a Chesapeake, Va.-based discount retailer.
| Issuer: | Dollar Tree Inc.
|
| Amount: | $4 billion
|
| Description: | Senior notes
|
| Bookrunners: | J.P. Morgan Securities LLC, BofA Merrill Lynch, Wells Fargo Securities LLC, RBC Capital Markets, LLC, Fifth Third Securities, Inc. and U.S. Bancorp Investments, LLC
|
| Senior co-managers: | PNC Capital Markets LLC and SunTrust Robinson Humphrey, | Inc.
|
| Co-managers: | Citizens Capital Markets, | Inc., HSBC Securities (USA) Inc., Regions Securities LLC and TD Securities (USA) LLC
|
| Trade date: | April 5
|
| Settlement date: | April 19
|
| Ratings: | Moody’s: Baa3
|
| S&P: BBB-
|
| Distribution: | SEC registered
|
| Marketing: | Fixed income investor calls
|
|
|
| Two-year floaters
|
| Amount: | $750 million
|
| Maturity: | April 17, 2020
|
| Coupon: | Libor plus 70 bps
|
| Price: | Par
|
| Yield: | Libor plus 70 bps
|
| Call features: | On and after April 22, 2019 at par
|
| Price guidance: | Libor plus 75 bps area
|
|
|
| Three-year notes
|
| Amount: | $1 billion
|
| Maturity: | May 15, 2023
|
| Coupon: | 3.7%
|
| Price: | 99.814
|
| Yield: | 3.74%
|
| Spread: | Treasuries plus 110 bps
|
| Call features: | Make-whole call at Treasuries plus 20 bps before April 15, 2023; thereafter at par
|
| Price guidance: | Treasuries plus 115 bps area
|
|
|
| Seven-year notes
|
| Amount: | $1 billion
|
| Maturity: | May 15, 2025
|
| Coupon: | 4%
|
| Price: | 99.899
|
| Yield: | 4.016%
|
| Spread: | Treasuries plus 125 bps
|
| Call features: | Make-whole call at Treasuries plus 20 bps before March 15, 2025; thereafter at par
|
| Price guidance: | Treasuries plus 130 bps area
|
|
|
| Ten-year notes
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| Amount: | $1.25 billion
|
| Maturity: | May 15, 2028
|
| Coupon: | 4.2%
|
| Price: | 99.736
|
| Yield: | 4.232%
|
| Spread: | Treasuries plus 140 bps
|
| Call features: | Make-whole call at Treasuries plus 25 bps before Feb. 15, 2028; thereafter at par
|
| Price guidance: | Treasuries plus 145 bps area
|
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