Intrepid Aviation talks downsized $500 million notes with 8½% coupon, possible step-up

By Paul A. Harris

Portland, Ore., July 30 – Intrepid Aviation Group Holdings, LLC and Intrepid Finance Co. talked a downsized $500 million offering of three-year senior notes (/B/B+) with an 8½% coupon and a possible step-up, according to a syndicate source.

The deal size is decreased from $515 million.

The coupon would step up 50 basis points if debt to equity leverage is above 3.5-times in 12 months and would step back down to 8½% when debt to equity leverage is below 3.5-times. The debt to equity test starts with third-quarter 2019 financials.

Books close at 1:30 p.m. ET on Monday, and the Rule 144A and Regulation S for life deal is set to price thereafter.

Jefferies LLC is the left bookrunner. J.P. Morgan Securities LLC and Goldman Sachs & Co. are the joint bookrunners.

The notes are non-callable during the first year, then become callable at par plus 50% of the coupon during the ensuing 15 months and become callable at par during the final nine months.

The Stamford, Conn.-based global aircraft leasing company plans to use the proceeds to refinance its 6 7/8% notes due 2019.

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