By Paul A. Harris
Portland, Ore., Dec. 10 – Rayonier A.M. Products Inc. priced a $500 million issue of springing maturity senior secured notes (CCC+/B-) at par to yield 7 5/8% on Thursday, according to market sources.
The yield printed at the tight end of yield talk in the 7¾% area, talk which was, itself, deep inside of early guidance in the low 9% area.
The deal was heard to be seven-times oversubscribed, a trader said.
BofA Securities Inc. was the left bookrunner. Houlihan Lokey was the joint bookrunner.
With respect to the springing maturity, unless the amount of notes outstanding is less than $50 million, they will mature at the earlier of five years (Jan. 15, 2026) and the springing maturity date, which will be 91 days prior to the maturity date of the existing 5½% senior notes due 2024 or 91 days prior to the maturity date of any debt incurred to refinance the 2024 notes.
Proceeds minus initial purchaser discounts, commissions and other offering expenses, together with cash on hand, will be used to pay off the company's existing credit agreement (other than outstanding letters of credit, which will be rolled into – or in respect of which back-to-back letters of credit will be issued under – the proposed ABL credit facility).
Rayonier is a Jacksonville, Fla.-based producer of cellulose-based technologies used in food, pharmaceuticals and other industrial applications.
| Issuer: | Rayonier A.M. Products Inc.
|
| Amount: | $500 million
|
| Maturity: | Earlier of Jan. 15, 2026 and springing maturity date
|
| Securities: | Senior secured notes
|
| Left bookrunner: | BofA Securities Inc.
|
| Joint bookrunner: | Houlihan Lokey
|
| Co-manager: | PNC Capital Markets LLC
|
| Coupon: | 7 5/8%
|
| Price: | Par
|
| Yield: | 7 5/8%
|
| Spread: | 724 bps
|
| Call protection: | Three years
|
| Trade date: | Dec. 10
|
| Settlement date: | Dec. 23
|
| Ratings: | Moody's: B1
|
| S&P: B-
|
| Distribution: | Rule 144A and Regulation S for life
|
| Price talk: | 7¾% area
|
| Marketing: | Roadshow
|
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