Ardagh upsizes to $1.05 billion equivalent, sets talk for PIK notes

By Paul A. Harris

Portland, Ore., June 5 – Ardagh Finance Holdings SA upsized its dual-currency offering of five-year senior PIK notes (existing ratings Caa2/CCC+) to $1.05 billion equivalent from $1 billion equivalent on Thursday, according to an informed source.

The deal is expected to come in the form of a €250 million tranche of euro-denominated notes with the balance to be issued in dollar-denominated notes.

Price talk was also announced. The dollar-denominated notes are expected to price with a yield of 8¾% at an original issue discount of 98 to 99. The euro-denominated notes are expected to yield 8½%, also with an original issue discount of 98 to 99.

Pricing is set for Thursday.

Citigroup Global Markets is the bookrunner for the Rule 144A and Regulation S for life offer.

The notes become callable after two years at par plus 50% of the coupon, and feature a 50% equity clawback at 102 until Dec. 31, 2015, and a 101% poison put;

The issuer is a financing subsidiary of Dublin, Ireland-based glass and metal container manufacturer Ardagh Group, which plans to use the proceeds to refinance its 11 1/8% senior secured PIK notes due 2018 and fund a €73 million shareholder dividend.

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