New Issue: Dresser-Rand $420 million 10-year notes yield 7 3/8%

By Paul A. Harris

St. Louis, Oct. 14 - Dresser-Rand Co. sold $420 million of 10-year senior subordinated notes (B3/B-) at par to yield 7 3/8% Thursday, according to market sources.

Price talk was 7½% to 7¾%.

Morgan Stanley, Citigroup and UBS Investment Bank ran the books for the Rule 144A issue.

Proceeds will be used to help fund First Reserve Corp.'s $1.2 billion acquisition of Dresser-Rand from Ingersoll-Rand Co. Ltd.

Dresser-Rand is an Olean, N.Y., supplier of infrastructure equipment to the energy industry.

Issuer:	Dresser-Rand Co.
Amount:	$420 million
Maturity:	Nov. 1, 2014
Security description:	Senior subordinated notes
Bookrunner:	Morgan Stanley, Citigroup, UBS Investment Bank
Coupon:	7 3/8%
Price:	Par
Yield:	7 3/8%
Spread:	337 basis points
Call features:	Callable after Nov. 1, 2009 at 103.688, 102.458, 101.223, par on or after Nov. 1, 2012
Equity clawback:	Until Nov. 1, 2007 for 35% at 107.375
Pricing date:	Oct. 14
Settlement date:	Oct. 29
Ratings:	Moody's: B3
	Standard & Poor's: B-
Price talk:	7½%-7¾%

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