Ardagh accelerates timing on $2.85 billion equivalent four-part offer; pricing expected Friday

By Paul A. Harris

Portland, Ore., April 26 – Ardagh Group accelerated timing on its $2.85 billion equivalent four-part offering of notes, cutting short a planned two-day roadshow in London, and moving up the roadshow in the United States, according to a syndicate source.

The new timeline puts the deal in front of investors in London on Tuesday only; the London leg of the roadshow previously was expected to continue on Wednesday.

The U.S. roadshow is now scheduled to take place during the Wednesday to Friday timeframe; that leg had previously been expected to carry into the week ahead.

The Rule 144A and Regulation S for life deal is now expected to price on Friday, whereas the original schedule had it pricing on May 4.

The offer includes $2 billion equivalent of seven-year senior secured notes, which become callable after three years at par plus 50% of the coupon, and $850 million equivalent of eight-year senior unsecured notes, callable after three years at par plus 75% the coupon.

Both the secured and unsecured notes are being offered in tranches of dollar-denominated and euro-denominated notes, with tranche sizes to be determined.

The dollar-denominated deal is going well, according to a trader, who added that the secured tranche is being discussed in the low 5% yield context, while the unsecured tranche is being discussed in the low 8% yield context. Both tranches are playing to $300 million to $500 million of demand apiece, the trader added.

Discussions on the euro-denominated tranches, meanwhile, have the euro-denominated secured notes coming in the mid-4% yield context, with the unsecured euro notes coming 2.5% behind the secured notes, according to a London-based sellside source.

Citigroup Global Markets is the bookrunner.

Barclays, Goldman Sachs and Deutsche Bank are the co-managers.

All of the notes feature 40% equity clawbacks and may be put by investors at 101 in the event of a change of control.

Proceeds will be used to help finance the acquisition of assets from Ball Corp. and Rexam plc. The acquisitions include certain metal beverage can manufacturing assets and support locations in Europe, the United States and Brazil, when Ball’s proposed acquisition of Rexam becomes complete.

Ardagh is a Dublin-based supplier of glass and metal packaging.

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