Published on 10/30/2023 in the Prospect News Investment Grade Daily.
New Issue: Arthur J. Gallagher sells $1 billion fixed-rate notes in two parts
By Wendy Van Sickle
Columbus, Ohio, Oct. 30 – Arthur J. Gallagher & Co. priced $1 billion of senior notes in two tranches (Baa2/BBB/BBB+) on Monday, according to an FWP filed with the Securities and Exchange Commission.
There was $400 million of 6.5% long 10-year notes at a spread of 163 basis points over Treasuries. These notes priced at 99.805 to yield 6.528%.
The deal also included $600 million of 6.75% long 30-year notes at a spread 178 bps over Treasuries. These notes priced at 98.756 to yield 6.849%.
BofA Securities, Inc., Barclays, BMO Capital Markets Corp., Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Lloyds Securities Inc. and Morgan Stanley & Co. LLC are the bookrunners.
Proceeds will be used for general corporate purposes, including the funding of future acquisitions.
Rolling Meadows, Ill.-based Gallagher is an insurance brokerage and risk management services company.
| Issuer: | Arthur J. Gallagher & Co.
|
| Amount: | $1 billion
|
| Issue: | Senior notes
|
| Bookrunners: | BofA Securities, Inc., Barclays, BMO Capital Markets Corp., Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Lloyds Securities Inc. and Morgan Stanley & Co. LLC
|
| Co-managers: | Capital One Securities, Inc., HSBC Securities (USA) Inc., PNC Capital Markets LLC, Wells Fargo Securities, LLC and Citizens JMP Securities, LLC
|
| Trustee: | Bank of New York Mellon Trust Co., NA
|
| Counsel to issuer: | Gibson, Dunn & Crutcher LLP
|
| Counsel to underwriters: | Cleary Gottlieb Steen & Hamilton LLP
|
| Trade date: | Oct. 30
|
| Settlement date: | Nov. 2
|
| Ratings: | Moody’s: Baa2
|
| S&P: BBB
|
| Fitch: BBB+
|
| Distribution: | SEC registered
|
|
|
| 2034 notes
|
| Amount: | $400 million
|
| Maturity: | Feb. 15, 2034
|
| Coupon: | 6.5%
|
| Price: | 99.805
|
| Yield: | 6.528%
|
| Spread: | Treasuries plus 163 bps
|
| Call: | Make-whole call at Treasuries plus 25 bps until Nov. 15, 2033, then a par call
|
| Put option: | At 101 upon change of control
|
| Cusip: | 04316JAF6
|
|
|
| 2054 notes
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| Amount: | $600 million
|
| Maturity: | Feb. 15, 2054
|
| Coupon: | 6.75%
|
| Price: | 98.756
|
| Yield: | 6.849%
|
| Spread: | Treasuries plus 178 bps
|
| Call: | Make-whole call at Treasuries plus 30 bps until Aug. 15, 2053, then a par call
|
| Put option: | At 101 upon change of control
|
| Cusip: | 04316JAG4
|
|
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