By Paul A. Harris
St. Louis, Feb. 28 - Rock-Tenn Co. priced $200 million of 9¼% eight-year senior notes (Ba3/BB-) at 99.30 to yield 9 3/8% on Thursday, according to an informed source.
The yield came on top of the 9 3/8% area price talk.
Initially the deal was expected to price Friday; however, early Thursday it was announced that pricing had been moved up.
An informed source said that the order book was five-times oversubscribed.
Banc of America Securities LLC, Wachovia Securities and SunTrust Robinson Humphrey were joint bookrunners for the Rule 144A with registration rights offering, which generated $198.6 million of proceeds.
Rabo Securities, Deutsche Bank Securities and Jefferies & Co. were the co-managers.
Proceeds will be used to partially finance the acquisition of Southern Container Corp.
The bond portion of the financing was downsized from $400 million, with $200 million of proceeds shifted to the company's term loan A, which was upsized to $550 million from $350 million.
The overall size of the credit facility was upsized to $1.2 billion from $1.0 billion.
Rock-Tenn is a Norcross, Ga., manufacturer of packaging products, merchandising displays and bleached and recycled paperboard.
| Issuer: | Rock-Tenn Co.
|
| Face amount: | $200 million
|
| Proceeds: | $198.6 million
|
| Maturity: | March 15, 2016
|
| Security description: | Senior notes
|
| Bookrunners: | Banc of America Securities LLC, Wachovia Securities, SunTrust Robinson Humphrey
|
| Co-managers: | Rabo Securities, Deutsche Bank Securities, Jefferies & Co.
|
| Coupon: | 9¼%
|
| Price: | 99.30
|
| Yield: | 9 3/8%
|
| Spread: | 596 bps
|
| Call protection: | Make-whole call at Treasuries plus 50 bps until March 15, 2012, then at 104.688, 102.344, par on and after March 15, 2014
|
| Equity clawback: | Until March 15, 2011 for 35% at 109.25
|
| Trade date: | Feb. 28
|
| Settlement date: | March 5
|
| Ratings: | Moody's: Ba3
|
| Standard & Poor's: BB-
|
| Price talk: | 9 3/8% area
|
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