By Paul A. Harris
Portland, Ore., Oct. 12 – Recordati SpA priced an upsized €1.3 billion amount of seven-year senior secured notes (B3/B) on Friday, according to market sources.
The deal included €650 million of fixed-rate notes that priced at par to yield 6¾%. The yield printed in the middle of yield talk in the 6¾% area. Talk on the fixed-rate tranche widened over the course of the week, as the deal was being shopped. Early guidance was 6% to 6½%, with ensuing indications at 6½% to 6¾%.
A €650 million tranche of Euribor plus 625 basis points floating-rate notes also priced at par. The spread came in the middle of spread talk in the 625 bps area. The reoffer price came on top of price talk.
The deal underwent covenant changes bearing primarily upon how the company may disburse cash and incur additional debt.
The issue size was increased from €1.28 billion.
The size of the revolving credit facility was decreased to €225 million from €250 million.
Joint global coordinator Deutsche Bank will bill and deliver. Credit Suisse and Jefferies were also joint global coordinators.
UniCredit, Banca IMI, Credit Agricole CIB, Natixis, SG CIB and UBI Banca were the joint bookrunners.
The issuing entity is Newco Rossini Acquisition Sarl, a special purpose vehicle controlled by CVC Capital Partners, which intends to use the proceeds from the bond sale to help fund its acquisition of a 51.8% stake in the Milan-based pharmaceutical company. The additional proceeds resulting from the €20 million upsize will be used as cash on the issuer's balance sheet.
| Issuer: | Newco Rossini Acquisition Sarl
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| Amount: | €1.3 billion, increased from €1.28 billion
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| Maturity: | Oct. 30, 2025
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| Securities: | Senior secured notes
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| Global coordinators: | Deutsche Bank (bill and deliver), Credit Suisse, Jefferies
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| Bookrunners: | UniCredit, Banca IMI, Credit Agricole, Natixis, SG, UBI Banca
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| Trade date: | Oct. 12
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| Ratings: | Moody's: B3
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| S&P: B
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| Distribution: | Rule 144A and Regulation S for life
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| Marketing: | Roadshow
|
|
|
| Fixed-rate notes
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| Amount: | €650 million
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| Coupon: | 6¾%
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| Price: | Par
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| Yield: | 6¾%
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| Spread: | 660 bps
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| First call: | Make-whole call at Bunds plus 50 bps until Oct. 30, 2021, then callable at 103.375
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| Equity clawback: | 40% at 106.75 until July 30, 2021
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| Price talk: | 6¾% area
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| Floating-rate notes
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| Amount: | €650 million
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| Coupon: | Euribor plus 625 bps
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| Euribor floor: | 0%
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| Price: | Par
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| Yield: | Euribor plus 625 bps
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| First call: | Make-whole call at Bunds plus 50 bps until Oct. 30, 2019, then callable at 101
|
| Price talk: | Euribor plus 625 bps area at par
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