By Paul A. Harris
St. Louis, Feb. 28 - Southern Natural Gas Co. and ANR Pipeline Co., both subsidiaries of The El Paso Corp., priced $700 million of 8 7/8% senior notes due March 15, 2010 (B1/B+) at 98.718 to yield 9 1/8%, on Friday, according to a syndicate source.
Price talk was 9 1/8%-9 3/8% on both deals.
Salomon Smith Barney and Credit Suisse First Boston were joint bookrunners on both offerings. ABN Amro, Bank of America, BNP Paribas and JP Morgan were co-managers.
Southern Natural Gas Co. priced $400 million of notes, with $95 million of the proceeds earmarked for general corporate purposes and the remainder to pay a dividend to El Paso Corp.
ANR Pipeline priced $300 million of notes, with proceeds to be used to retire payables to affiliates and $25 million retained for general corporate purposes.
Issuer: Southern Natural Gas Co.
| Face amount: | $400 million
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| Rule 144A Cusip: | 8433452BA0
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| Issuer: | ANR Pipeline Co.
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| Face Amount: | $300 million
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| Rule 144A Cusip: | 001814AU6
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| Terms for both issues:
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| Maturity: | March 15, 2010
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| Security description: | Senior notes
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| Bookrunners: | Salomon Smith Barney, Credit Suisse First Boston
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| Co-managers: | ABN Amro, Bank of America, BNP Paribas, JP Morgan
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| Coupon: | 8 7/8%
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| Price: | 98.718
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| Yield: | 9 1/8%
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| Spread: | 591 basis points
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| Call features: | Callable on March 15, 2007 at 104.438, then at 102.219, declining to par on March 15, 2009 and thereafter
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| Equity clawback: | None
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| Settlement date: | March 5, 2003 (T+3)
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| Ratings: | Moody's: B1
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| Standard & Poor's: B+
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| Price talk: | 9 1/8%-9 3/8%
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