Horsepower to start roadshow Tuesday for $275 million 10-year notes

By Paul A. Harris and Sara Rosenberg

St. Louis, July 2 - Horsepower Holdings, Inc. will begin a roadshow on Tuesday for a $275 million offering of 10-year senior notes, according to informed sources.

The proceeds were shifted to the proposed bonds following the company's decision to eliminate its $275 million term loan B, according to a market source.

UBS Investment Bank is the left lead manager for the note offering, which is being placed via Rule 144A and Regulation S with registration rights. Goldman Sachs & Co. is the joint bookrunner.

The notes will come with five years of call protection.

Credit ratings remain to be determined.

Proceeds will be used to fund a portion of the proposed mergers of Basic Energy Services, Inc. and Grey Wolf, Inc. with and into Horsepower Holdings, after which Horsepower Holdings will be renamed Grey Wolf, Inc. Some proceeds will also be used to refinance Basic's revolver.

The prospective issuer is a Houston-based provider of contract drilling and well site services to the U.S. upstream oil and gas sector.

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