Hercules $250 million 25-year bonds talked at 6½% area, pricing Thursday

By Paul A. Harris

St. Louis, March 24 - Hercules Inc.'s offering of $250 million of 25-year notes (Ba3/B+) is talked at a yield in the 6½% area, according to a syndicate source.

The deal is expected to price on Thursday afternoon, the source added.

Credit Suisse First Boston is the bookrunner for the Rule 144A offering.

The notes will initially be issued as senior subordinated notes but will become senior notes when the existing 11 1/8% senior notes are refinanced.

Although the notes will have a 25-year maturity, the structure will resemble a 10-year non-call-five note since there will be a call after five years and a put after 10.

In addition they will contain a three-year 35% equity clawback.

Proceeds will be used to refinance the company's existing credit facility and its 9.42% trust preferreds, and for general corporate purposes.

Hercules is a Wilmington, Del.-based specialty chemical manufacturer.

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