All Aboard Florida starts roadshow for $390 million PIK toggle notes

By Paul A. Harris

Portland, Ore., June 4 - All Aboard Florida plans to price a $390 million offering of five-year senior secured PIK toggle notes on Friday, according to a market source.

J.P. Morgan Securities LLC and Morgan Stanley are the joint bookrunners for the Rule 144A and Regulation S for life offer. BMO Securities is the co-manager.

The notes become callable after two years at par plus 50% of the coupon.

The issuer may redeem the notes at par plus 75% of the coupon with proceeds of a government loan during the first two years.

Proceeds will be used to finance all or part of the design, construction, development and equipping of the Miami to West Palm Beach portion of a higher speed intercity passenger train line from Miami to Orlando.

The deal comes with a mandatory redemption at par if the company abandons the project before the opening deadline and with an offer to purchase the notes at par if the project fails to open by the opening deadline.

The issuing entities are AAR Holdings LLC and AAF Finance Co.

All Aboard Florida, a subsidiary of Florida East Coast Industries, is a Coral Gables, Fla.-based privately owned passenger rail system.

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