By Paul A. Harris
St. Louis, April 28 - FS Funding A/S, a special purpose vehicle of Denmark-based global facilities services provider ISS, upsized to €1.3 billion its two-part offering of 10-year senior subordinated notes (Caa1/B3) and priced both tranches on Friday, according to market sources.
The company priced a €454 million issue of 8 7/8% fixed-rate notes at 99.182 to yield 9%, on top of price talk that had been revised from the 9% area. The fixed-rate notes generated €450.3 million of proceeds.
The company also priced an €850 million issue of floating-rate notes at par to yield three-month Euribor plus 662.5 basis points, on top of price talk that had been revised from Euribor plus 700 basis points.
Citigroup and Goldman Sachs & Co. were joint bookrunners for the notes, which were issued via Rule 144A and Regulation S.
The offering was upsized from €975 million. A proposed dollar-denominated tranche was abandoned.
Proceeds will be used to repay the bridge loan that was incurred to fund the acquisition of the company by EQT Partners and GS Capital Partners. The additional proceeds, which are expected to be generated by the upsizing, will be used to redeem the company's €134 million of PIK notes.
The financing also includes a DKK 9.675 billion credit facility and DKK 7.963 billion of sponsor equity.
| Issuer: | FS Funding A/S (ISS)
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| Amount: | €1.3 billion (increased from €975 million)
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| Maturity: | May 15, 2016
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| Security description: | Senior subordinated notes
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| Bookrunners: | Citigroup, Goldman Sachs
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| Trade date: | April 28
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| Settlement date: | May 8
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| Ratings: | Moody's: Caa1
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| Standard & Poor's: B-
|
| Distribution: | Rule 144A/Regulation S
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|
|
| Fixed-rate tranche
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| Face amount: | €454 million
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| Proceeds: | Approximately €450.3 million
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| Coupon: | 8 7/8%
|
| Price: | 99.182
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| Yield: | 9%
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| Call features: | Callable on and after May 15, 2011 at 104.438, 102.958, 101.479, par on and after May 15, 2014
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| Equity clawback: | Until May 15, 2009 for 35% at 108.875
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| Price talk: | 8 7/8% at discount to yield 9% (revised from 9% area)
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| Floating-rate notes
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| Amount: | €850 million
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| Coupon: | Three-month Euribor plus 662.5 bps
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| Price: | Par
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| Yield: | Three-month Euribor plus 662.5 bps
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| Call protection: | Callable immediately at 102, 101, par after two years
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| Equity clawback: | Until May 15, 2009 for 35% at par plus the applicable coupon
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| Price talk: | Euribor plus 662.5 bps (revised from Euribor plus 700 bps)
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