New Issue: HD Supply sells upsized $1 billion notes due 2020 at par to yield 11½%

By Paul A. Harris

Portland, Ore., Oct. 9 - HD Supply, Inc. priced a massively upsized $1 billion issue of senior notes due July 15, 2020 (Caa2/CCC+/) at par to yield 11½% on Tuesday, according to a syndicate source.

The yield printed at the wide end of the 11¼% to 11½% yield talk.

The deal was upsized from $750 million.

Bank of America Merrill Lynch, Goldman Sachs & Co., Barclays, J.P. Morgan Securities LLC, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Wells Fargo Securities LLC and UBS Investment Bank are the joint bookrunners.

The industrial distributor plans to use the proceeds to redeem a portion of its outstanding senior subordinated notes.

Issuer:	HD Supply, Inc.
Amount:	$1 billion, increased from $750 million
Maturity:	July 15, 2020
Securities:	Senior notes
Bookrunners:	Bank of America Merrill Lynch, Goldman Sachs & Co., Barclays, J.P. Morgan Securities LLC, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Wells Fargo Securities LLC, UBS Investment Bank
Co-managers:	Baird, BB&T, Raymond James, SunTrust Robinson Humphrey
Coupon:	11½%
Price:	Par
Yield:	11½%
Spread:	1,029 bps
Call protection:	Make-whole call at Treasuries plus 50 bps until Oct. 15, 2016, then callable at a premium
Trade date:	Oct. 9
Settlement date:	Oct. 15
Ratings:	Moody's: Caa2
	Standard & Poor's: CCC+
Distribution:	Rule 144A with registration rights and Regulation S
Price talk:	11¼% to 11½%
Marketing:	Quick to market

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