Range Resources prices upsized $750 million deal; new bonds firm; forward calendar builds busily

By Paul Deckelman

New York, March 4 - Range Resources Corp. was heard by high-yield syndicate sources to have priced an upsized $750 million issue of 10-year notes on Monday.

The energy company's new offering firmed smartly when the bonds were freed for secondary dealings, traders said.

Two other pricings were heard to have taken place during the session. Semiconductor production services company STATS Chip PAC Ltd. priced $255 million of five-year notes.

And Cornerstone Chemical Co. was heard by market sources to have set the terms for its planned offering of five-year paper, although the details of the Regulation D private placement will be officially released when the deal closes, probably around the end of the week.

Besides the issues that actually came to market, primaryside players were kept busy by the swelling forward calendar.

Wireless operator MetroPCS Communications, Inc. unveiled plans to offer two benchmark-sized tranches of senior notes.

Three other companies also announced new deal plans: real estate operator CBRE Group Inc. will sell $800 million of bonds; Redbox movie-rental kiosk operator Coinstar Inc. will do $300 million of six-year bonds; and behavioral health care services provider Acadia Healthcare Co. Inc. is shopping $150 million of eight-year notes around.

Secondary market trading remained largely focused on new or recent issues, including Monday's Range Resources deal, for instance, and last week's big two-part offering from Equinix Inc., which remained one of the busiest names in Junkbondland.

Statistical indicators of market performance remained technically mixed, as they were for most of last week, but with a clearly firmer tone.

Range Resources upsizes

The principal deal of the day was Range Resources' $750 million of senior subordinated notes due 2023, which came to market after it was upsized from the originally announced $500 million.

High-yield syndicate sources said that the notes priced at par to yield 5%, at the wide end of price talk envisioning a yield between 4 7/8% and 5%.

The quickly shopped Rule 144A/Regulation S offering came to market via joint bookrunning managers J.P. Morgan Securities LLC, Bank of America Merrill Lynch, Wells Fargo, Securities, LLC, Barclays Capital Inc., Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc., as well as a lengthy roster of co-managers.

Range Resources, a Fort Worth, Texas-based independent oil and natural gas exploration and production company, plans to use the deal proceeds to repay senior credit facility borrowings.

STATS ChipPAC new paper

STATS ChipPAC announced on Monday that it had priced $255 million of 4½% senior notes due 2018.

The company said that the new notes would have the same terms and conditions as the exchange notes, which it plans to issue to the holders of its present 7½% senior notes due 2015 under a currently pending exchange offer that is scheduled to expire on March 15 and close on March 20.

The exchange notes and these newly priced concurrent offering notes will be governed by the same indenture and will constitute a single series.

The notes are being offered for sale under Rule 144A and Regulation S.

When it announced the tender offer for the 7½% notes, the Singapore-based provider of semiconductor testing, packaging and manufacturing services indicated that it would issue a maximum $640 million of the new exchange notes and any concurrently offered notes.

Proceeds from the new offering will be used to redeem any of the 7½% notes not taken out via the exchange offer.

Cornerstone sets terms

Market sources heard that Cornerstone Chemical had formally set the terms on its planned $220 million private placement of senior secured notes due 2018 on Monday evening.

Those terms will be officially released when the offering closes, which is expected by the end of the week.

The deal is a Regulation D private placement with no registration rights. One of the sources said that is the reason why the terms were not immediately available, as they would be in a conventional junk bond deal.

A source said on Monday evening that he heard that the deal will yield 9 3/8%, about in line with price talk of 9½%, plus or minus 1/8%, which had circulated on Friday.

Imperial Capital and Keybanc Capital Markets are the placement agents.

Cornerstone, a Waggaman, La.-based producer of critical intermediate and specialty chemicals, plans to use the proceeds from the deal to repay debt and to pay a cash dividend to shareholders.

Big Metro deal ahead

While those deals were pricing, high-yield syndicate sources noted that the junk primary calendar was growing.

On Monday evening - well after the market had closed up shop for the day - MetroPCS Communications announced plans to sell two big "benchmark-sized" tranches of senior notes.

The Dallas-based prepaid wireless telecommunications company did not offer any more specific information as to the size of the prospective bond deal or the individual tranches, their maturities or the structure of the notes.

The company said that the notes would actually be sold by its wholly owned indirect subsidiary, MetroPCS Wireless Inc., under Rule 144A and Regulation S.

The company will use the proceeds from the deal to repay the outstanding amounts owed under its existing senior secured credit facility in connection with its pending merger with larger sector peer T-Mobile USA, Inc., among other uses, plus general corporate purposes.

CBRE plans offering

Another big deal the junk market can expect to see fairly soon will be CBRE Group's $800 million of senior notes, although the paper will actually be issued by the company's wholly owned CBRE Services, Inc. subsidiary.

The notes will be offered under a shelf registration statement the company previously filed with the Securities and Exchange Commission.

Syndicate sources indicated on Monday that Bank of America Merrill Lynch, Credit Suisse Securities (USA) LLC, J.P. Morgan, Wells Fargo, RBS Securities Inc., HSBC Securities (USA) Inc. and Barclays. will act as the underwriters.

CBRE Group, a Los Angeles-based real estate company, plans to use the proceeds from the bond deal for general corporate purposes, including repayment of a portion of its outstanding debt

Timing of the issue was still up in the air. A market source noted that the timing may be connected with that of the company's $1,715,000,000 bank debt deal, which is expected to launch with a bank meeting on Wednesday.

Coinstar is coming

Coinstar was heard by high-yield syndicate sources on Monday to be getting ready to sell $300 million senior notes due 2019.

The sources said that the Rule 144A with registration rights/Regulation S deal will be marketed to potential investors via a roadshow, which begins on Tuesday in Boston, and a midday Tuesday investor call. Pricing is expected to take place late in the week.

BofA, Wells Fargo and HSBC will be the joint bookrunners on the offering, with Morgan Stanley & Co. Inc., RBC Capital Markets LLC, and U.S. Bancorp Investments, Inc. as senior co-managers and Comerica Securities, Inc. and Mitsubishi UFJ Securities as co-managers.

Coinstar, a Bellevue, Wash.-based provider of automated retailing systems, such as the well-known Redbox movie and videogame rental kiosks, plans to use the deal proceeds for general corporate purposes, which the company says could include maintenance or repayment of outstanding debt, acquisitions or other investments, and payment of other corporate expenses.

Acadia shops deal

Acadia Healthcare announced plans to sell $150 million senior unsecured notes due 2021.

Junk market syndicate sources said that the deal is expected to price on Thursday.

They said that the Rule 144A with registration rights/Regulation S deal it will come to market via joint bookrunning managers BofA, Citigroup Global Markets Inc. and Jefferies & Co. Inc., along with co-manager Fifth Third Securities Inc.

Acadia, a Franklin, Tenn.-based provider of inpatient behavioral health care services, plans to use the proceeds from the deal for general corporate purposes, which may include acquisitions.

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