Houghton Mifflin trims notes to $300 million, hikes talk to 9% coupon at 98 to yield about 9½%

By Paul A. Harris

Portland, Ore., Nov. 19 – Houghton Mifflin Harcourt Publishers Inc. downsized its offering of 5.25-year senior secured notes (B3/B/BB-) to $300 million from $350 million, shifting $50 million of the proceeds to its term loan B, according to market sources.

Talk on the bonds widened. Revised talk has the notes coming with a 9% coupon, discounted to 98, to yield about 9½%. Earlier official talk was 8½% to 8¾%. Initial talk was 8¼% to 8½%.

Books close at 2 p.m. ET on Tuesday, and the Rule 144A for life and Regulation S offering is set to price thereafter.

Morgan Stanley & Co. LLC, Citigroup Global Markets Inc., BofA Securities Inc. and Wells Fargo Securities LLC are the joint bookrunners. Citizens Capital Markets Inc. is the co-manager.

The notes become callable after 2.25 years at par plus 50% of coupon.

The Boston-based publisher of education materials and provider of related services plans to use the proceeds, together with the new term loan and cash on hand, to refinance its existing term loan B.

The co-issuers are Houghton Mifflin Harcourt Publishing Co. and HMN Publishers LLC.

The above-mentioned shift of proceeds to the term loan from the bonds increases the loan size to $380 million from $330 million.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.