New Issue: Hanover Compressor sells $200 million 10-year notes to yield 9%

By Paul A. Harris

St. Louis, May 25 - Hanover Compressor Co. priced a quick-to-market $200 million of 10-year senior notes (B3/B) at par on Tuesday to yield 9%, according to a syndicate source.

Price talk was 8¾% to 9%.

JPMorgan and Citigroup ran the books for the off-the-shelf issue. The co-managers were Banc of America Securities, Calyon Securities, Credit Suisse First Boston, The Royal Bank of Scotland, Scotia Capital and Wachovia Securities.

Proceeds will be used to refinance existing debt.

Hanover Compressor is a Houston-based company that rents and repairs compressors and performs natural gas compression services for oil and gas companies.

Issuer:	Hanover Compressor Co.
Amount:	$200 million
Maturity:	June 1, 2014
Security description:	Senior notes
Bookrunners:	JPMorgan, Citigroup
Co-managers:	Banc of America Securities, Calyon Securities, Credit Suisse First Boston, The Royal Bank of Scotland, Scotia Capital, Wachovia Securities
Coupon:	9%
Price:	Par
Yield:	9%
Spread:	427 basis points
Call features:	Make-whole call at Treasuries plus 50 basis points until June 1, 2009, then at 104.50, 103.00, 101.50, par on or after June 1, 2012
Equity clawback:	Until June 1, 2007 for 35% at 109
Pricing date:	May 25
Settlement date:	June 1
Ratings:	Moody's: B3
	Standard & Poor's: B
Price talk:	8¾%-9%

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