By Paul Deckelman
New York, July 12 - Heckler & Koch GmbH (B1/B) priced a slightly upsized €120 million offering of seven-year senior secured notes on Monday at par to yield 9¼%, according to syndicate sources.
The deal was increased from the €115 million originally shopped around and came at the tight end of pre-deal price talk of 9¼% to 9½%. The spread over the reference security was 560 basis points.
The Rule 144A/Regulation S issue was brought to market in Europe by sole bookrunning manager Citigroup. The pricing followed a roadshow for the notes last week.
The notes are not callable for the first four years after issue. They are secured with first-priority security interest over capital stock and the note proceeds loan.
The Oberndorf, Germany-based company - a defense contractor in the small arms segment that sells only to NATO military and law enforcement clients - plans to use the proceeds of the offering to repay loans, pre-fund capital expenses and to provide working capital for its U.S. plant.
| Issuer: | Heckler & Koch GmbH
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| Amount: | €120 million (upsized from €115 million)
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| Security description: | Senior secured notes
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| Bookrunner: | Citigroup
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| Maturity: | July 15, 2011
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| Coupon: | 9¼%
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| Price: | Par
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| Yield: | 9¼%
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| Spread: | 560 basis points over DEM 5¼% of 2011
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| Call features: | Non-callable for first four years; then callable from July 15, 2008 at 104.625, then 102.313, declining to par on 15, 2010
|
| Ratings: | Moody's: B1
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| S&P: B
|
| Settlement date: | July 16 (T+4), flat
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