Published on 2/12/2024 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, Feb. 12 – 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 $500 million of 5.45% long 10-year notes at a spread of 132 basis points over Treasuries. These notes priced at 99.722 to yield 5.486%.
The deal also included $500 million of 5.75% long 30-year notes at a spread 147 bps over Treasuries. These notes priced at 98.788 to yield 5.836%.
BofA Securities, Inc., J.P. Morgan Securities LLC, Barclays, BMO Capital Markets Corp., Citigroup Global Markets Inc. and Morgan Stanley & Co. LLC are the bookrunners.
Proceeds will be used for general corporate purposes, which may include acquisitions, repayment of outstanding debt, capital expenditures, working capital and stock repurchases.
Gallagher is an insurance brokerage, risk management and corporate services company based in Rolling Meadows, Ill.
| Issuer: | Arthur J. Gallagher & Co.
|
| Amount: | $1 billion
|
| Issue: | Senior notes
|
| Bookrunners: | BofA Securities, Inc., J.P. Morgan Securities LLC, Barclays, BMO Capital Markets Corp., Citigroup Global Markets Inc. and Morgan Stanley & Co. LLC
|
| Co-managers: | Capital One Securities, Inc., HSBC Securities (USA) Inc., Lloyds Securities Inc., PNC Capital Markets LLC and Wells Fargo 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: | Feb. 12
|
| Settlement date: | Feb. 15
|
| Ratings: | Moody’s: Baa2
|
| S&P: BBB
|
| Fitch: BBB+
|
| Distribution: | SEC registered
|
|
|
| 2034 notes
|
| Amount: | $500 million
|
| Maturity: | July 15, 2034
|
| Coupon: | 5.45%
|
| Price: | 99.722
|
| Yield: | 5.486%
|
| Spread: | Treasuries plus 132 bps
|
| Call: | Make-whole call at Treasuries plus 205 bps until April 15, 2034, then a par call
|
| Put option: | At 101 upon change of control
|
| Cusip: | 04316JAH2
|
|
|
| 2054 notes
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| Amount: | $500 million
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| Maturity: | July 15, 2054
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| Coupon: | 5.75%
|
| Price: | 98.788
|
| Yield: | 5.836%
|
| Spread: | Treasuries plus 147 bps
|
| Call: | Make-whole call at Treasuries plus 25 bps until Jan. 15, 2054, then a par call
|
| Put option: | At 101 upon change of control
|
| Cusip: | 04316JAJ8
|
|
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