Published on 5/5/2011 in the Prospect News High Yield Daily.
New Issue: Host Hotels sells upsized $425 million 5 7/8% eight-year notes at 99.198 to yield 6%
By Paul A. Harris
Portland, Ore., May 5 - Host Hotels & Resorts, LP priced an upsized $425 million issue of 5 7/8% eight-year series W senior notes (Ba1/BB+/) at 99.198 to yield 6% on Thursday, according to an informed source.
The yield printed at the tight end of price talk, which had been set in the 6 1/8% area.
Bank of America Merrill Lynch, Deutsche Bank Securities Inc., Goldman Sachs & Co. and J.P. Morgan Securities LLC were the joint bookrunners for the quick-to-market issue, which was upsized from $350 million.
Proceeds will be used to redeem all $250 million of the company's 7 1/8% series K senior notes due 2013, as well as to repay $50 million of bank debt and for general corporate purposes.
Host Hotels is a Bethesda, Md.-based real estate investment trust that owns and operates hotel properties.
| Issuer: | Host Hotels & Resorts, LP
|
| Face amount: | $425 million, increased from $350 million
|
| Proceeds: | $421,592,000 (approximate)
|
| Maturity: | June 15, 2019
|
| Securities: | Series W senior notes
|
| Bookrunners: | Bank of America Merrill Lynch, Deutsche Bank Securities Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC
|
| Senior co-managers: | Scotia Capital (USA) Inc., Wells Fargo Securities, LLC, Credit Agricole Securities (USA) Inc., RBS Securities Inc., Citigroup Global Markets Inc., SG Americas Securities, LLC
|
| Junior co-managers: | BNY Capital Markets, LLC, Barclays Capital Inc., Credit Suisse Securities (USA) LLC, UBS Securities LLC, RBC Capital Markets, LLC
|
| Coupon: | 5 7/8%
|
| Price: | 99.198
|
| Yield: | 6%
|
| Spread: | 314 bps
|
| Call features: | Make-whole call at Treasuries plus 50 bps until June 15, 2015, then callable at 102.938, 101.469, par on and after June 15, 2017 and thereafter
|
| Equity clawback: | 35% at 105.875 until June 15, 2014
|
| Change-of-control put: | 101%
|
| Trade date: | May 5
|
| Settlement date: | May 11
|
| Ratings: | Moody's: Ba1
|
| Standard & Poor's: BB+
|
| Distribution: | Rule 144A with registration rights
|
| Price talk: | 6 1/8% area
|
| Marketing: | Quick to market
|
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