By Paul A. Harris
Portland, Ore., May 17 - EchoStar Corp. completed an upsized $2 billion issuance of notes in two parts on Tuesday, according to an informed source.
An upsized $1.1 billion tranche of eight-year senior secured notes (Ba3/B+/) priced at par to yield 6½%.
The tranche was upsized from $1 billion. The yield printed at the tight end of price talk, which had been set in the 6 5/8% area.
In addition, an upsized $900 million tranche of 10-year senior unsecured notes (B3/B-/) priced at par to yield 7 5/8%.
The tranche was upsized from $800 million. The yield printed 12.5 basis points inside of price talk that had been set in the 7 7/8% area.
Both tranches are non-callable.
The senior secured notes come with a provision allowing the issuer to redeem 10% of the notes annually for the first four years.
Deutsche Bank Securities Inc. ran the books for the two-part deal, the overall size of which was increased from $1.8 billion.
Proceeds will be used to fund the purchase of Hughes Communications, Inc.
The issuing entity will be EH Holding Corp., a subsidiary of EchoStar, an Englewood, Colo.-based provider of equipment sales, digital broadcast operations and satellite services.
| Issuer: | EH Holding Corp. (EchoStar Corp.)
|
| Amount: | $2 billion, increased from $1.8 billion
|
| Bookrunner: | Deutsche Bank Securities Inc.
|
| Trade date: | May 17
|
| Settlement date: | June 1
|
| Distribution: | Rule 144A with registration rights and Regulation S
|
| Marketing: | Roadshow
|
|
|
| Senior secured notes
|
| Amount: | $1.1 billion, increased from $1 billion
|
| Maturity: | June 15, 2019
|
| Description: | Senior secured notes
|
| Coupon: | 6½%
|
| Price: | Par
|
| Yield: | 6½%
|
| Spread: | 409 bps
|
| Call protection: | Non-callable (Make-whole provision at Treasuries plus 50 bps)
|
| Special redemption: | 10% of the notes are callable annually at 103 during the first four years
|
| Equity clawback: | 35% at 106.50 until June 15, 2014
|
| Ratings: | Moody's: Ba3
|
| Standard & Poor's: B+
|
| Price talk: | 6 5/8% area
|
|
|
| Senior unsecured notes
|
| Amount: | $900 million, increased from $800 million
|
| Maturity: | June 15, 2021
|
| Description: | Senior unsecured notes
|
| Coupon: | 7 5/8%
|
| Price: | Par
|
| Yield: | 7 5/8%
|
| Spread: | 451 bps
|
| Call protection: | Non-callable (Make-whole provision at Treasuries plus 50 bps)
|
| Equity clawback: | 35% at 107.625 until June 15, 2014
|
| Ratings: | Moody's: B3
|
| Standard & Poor's: B-
|
| Price talk: | 7 7/8% area
|
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