By Paul A. Harris
Portland, Ore., Aug. 17 – H&E Equipment Services, Inc. priced a $750 million issue of eight-year senior notes (B2/BB-) at par to yield 5 5/8% in a quick-to-market Thursday trade, according to an informed source.
The yield printed at the tight end of yield talk in the 5¾% area.
Wells Fargo Securities LLC was the bookrunner.
The Baton Rouge, La.-based heavy equipment manufacturing and services company plans to use the proceeds to tender, redeem and or repurchase its 7% senior notes due 2022 and to repay a portion of its ABL facility.
The new deal surfaced on the heels the H&E Equipment Services' bid for Neff Corp. falling to a competing bid from United Rentals Inc. (see related story in this issue).
H&E Equipment had in place an $825 million senior unsecured bridge loan to help fund that acquisition of Neff for $1.2 billion, including about $690 million in debt currently on Neff's balance sheet.
The high-yield bond market had anticipated an $825 million bond offering to replace the bridge loan.
In the wake of the succeeding bid from United Rentals, which H&E Equipment is declining to counter, the bridge loan is canceled, sources said.
| Issuer: | H&E Equipment Services, Inc.
|
| Amount: | $750 million
|
| Maturity: | Sept. 1, 2025
|
| Securities: | Senior notes
|
| Bookrunner: | Wells Fargo Securities LLC
|
| Coupon: | 5 5/8%
|
| Price: | Par
|
| Yield: | 5 5/8%
|
| Spread: | 351 bps
|
| First call: | Sept. 1, 2020 at 104.219
|
| Equity clawback: | 40% at 105.625 until Sept. 1, 2020
|
| Trade date: | Aug. 17
|
| Settlement date: | Aug. 24
|
| Ratings: | Moody's: B2
|
| S&P: BB-
|
| Distribution: | Rule 144A and Regulation S for life
|
| Price talk: | 5¾% area
|
| Marketing: | Quick to market
|
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