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Ardagh offers $1.4 billion and €500 million notes in three-part debt refinancing deal
By Paul A. Harris
Portland, Ore., Feb. 24 – Ireland’s Ardagh Group is expected to price $1.4 billion and €500 million of high-yield notes, most if not all of it on Friday, market sources say.
The three-part deal features a pair of Rule 144A and Regulation S for life secured tranches (existing ratings Ba3/BB-). These include a $700 million tranche of five-year senior secured notes, which comes with two years of call protection, and a €500 million tranche of seven-year notes, which comes with three years of call protection.
The dollar-denominated five-year notes are in the market with early guidance in the low 4% area, a trader said.
The euro-denominated seven-year notes have early guidance in the high 2% area to 3%.
Both secured tranches feature 40% equity clawbacks and 101% poison puts.
In addition there is an unsecured tranche (existing ratings B3/CCC+): A $700 million fungible add-on to the Ardagh Packaging Finance plc and Ardagh Holdings USA Inc. 6% senior notes due Feb. 15, 2025 is coming with initial guidance in the 101.5 area. The original $1 billion issue priced at par on Jan. 19, 2017.
The dollar-denominated notes are expected to price on Friday. The euro-denominated notes are expected to price on Friday or on Monday, according to a syndicate source.
However the euro-denominated notes will likely price on Friday, as well, a trader said.
Citigroup is the left bookrunner. Other syndicate names are expected to be announced.
Ardagh Packaging Finance and Ardagh Holdings USA are the issuing entities for all tranches.
The Dublin-based supplier of glass and metal packaging plans to use the proceeds to call its $415 million of 6¾% senior notes due 2021 and its $265 million first priority senior secured floating-rate notes due 2019 in full, as well as to repay its $663 million term loan B in full, and redeem €500 million of 4¼% first priority senior secured notes due 2022 with a make-whole call.
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