New Issue: EarthLink prices downsized $300 million 8 7/8% eight-year notes at 96.555 to yield 9½%

By Paul A. Harris

Portland, Ore., May 12 - EarthLink, Inc. priced a downsized $300 million issue of 8 7/8% eight-year senior notes (B2/B-/) at 96.555 to yield 9½% on Thursday, according to an informed source.

The yield printed at the wide end of the 9¼% to 9½% price talk.

Deutsche Bank Securities Inc., Bank of America Merrill Lynch and Credit Suisse Securities (USA) LLC were the joint bookrunners for the issue, which was downsized from $400 million.

The Atlanta-based internet service provider plans to use the proceeds to redeem its 3¼% convertible notes and for general corporate purposes.

Issuer:	EarthLink, Inc.
Face amount:	$300 million, decreased from $400 million
Proceeds:	$289,665,000
Maturity:	May 15, 2019
Securities:	Senior notes
Bookrunners:	Deutsche Bank Securities Inc., Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC
Coupon:	8 7/8%
Price:	96.555
Yield:	9½%
Spread:	671 bps
Call features:	Callable on May 15, 2015 at 104.438, 102.219, par on and after May 15, 2017
Equity clawback:	35% at 108.875 until May 15, 2014
Trade date:	May 12
Settlement date:	May 17
Ratings:	Moody's: B2
	Standard & Poor's: B-
Distribution:	Rule 144A with registration rights
Price talk:	9¼% to 9½%
Marketing:	Quick to market

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