By Paul Deckelman
New York, Aug. 5 - Iron Mountain Inc. priced a $550 million issue of 12-year senior subordinated notes (B2/ B+) to yield 8.425%, high yield syndicate sources said Wednesday.
The quickly-shopped drive-by deal - announced by the company on Wednesday morning and priced later that same day - was upsized from the originally planned $450 million.
The 8 3/8% notes due Aug. 15, 2021 priced at 99.625.
A primaryside source said that the difference between the issue price and par was "the smallest OID [original issue discount] this year on a dollar-denominated new issue."
The deal came in the middle of price talk envisioning a yield between 8 3/8% and 8½%, with around 1 point of OID.
The notes were sold though a public offering under the company's shelf registration statement already filed with the Securities and Exchange Commission.
They will carry call protection for the first five years after issue.
The deal was brought to market via joint bookrunners Barclays Capital, Inc., Bank of America Merrill Lynch, J.P. Morgan Securities, Inc. and Scotia Capital (USA) Inc.
Morgan Stanley & Co., Inc. and RBS Securities, Inc. served as senior co-managers, while Deutsche Bank Securities, Inc. and HSBC Securities (USA) Inc. acted as junior co-managers.
Iron Mountain, a Boston-based document storage and information protection company, said it plans to use the deal proceeds to pay for the redemption of its existing 8 5/8% senior subordinated notes due 2013; as of June 30, it had $447.951 million of those notes outstanding. It also said that it could use part of the proceeds for the possible repayment of unspecified other company debt, and for general corporate purposes, including potential future acquisitions and investments.
| Issuer: | Iron Mountain Inc.
|
| Face Amount: | $550 million (upsized from $450 million)
|
| Proceeds: | $547,937,500
|
| Maturity: | Aug. 15, 2021
|
| Security description: | Senior subordinated notes
|
| Bookrunners: | Barclays Capital, Inc., Bank of America Merrill Lynch, J.P. Morgan Securities, Inc. and Scotia Capital (USA) Inc.
|
| Co-managers: | Senior: Morgan Stanley & Co., Inc. and RBS Securities, Inc.
|
| Junior: Deutsche Bank Securities, Inc. and HSBC Securities (USA) Inc.
|
| Coupon: | 8 3/8%
|
| Price: | 99.625
|
| Yield: | 8 .425%
|
| Spread: | 466 bps
|
| Call features: | Make-whole provision at Treasuries plus 75 bps until Aug. 15, 2014, then callable at 104.188; callable on or after Aug. 15, 2015 at 102.792; callable on or after Aug. 15, 2016 at 101.396; and finally callable at par on or after Aug. 15, 2017.
|
| Equity clawback: | At 108.375 until Aug. 15, 2012, provided at least $357.5 million principal amount of notes (including any additional notes subsequently issued) remain outstanding immediately after
|
| Trade date: | Aug. 5
|
| Settlement date: | Aug. 10
|
| Ratings: | Moody's: B2
|
| S&P: B+
|
| Distribution: | Off shelf
|
| Price talk: | 8 3/8% to 8½%, plus around 1 point OID
|
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