Published on 2/17/2021 in the Prospect News High Yield Daily.
New Issue: Avis Budget sells $600 million eight-year notes at par to yield 5 3/8%
By Paul A. Harris
Portland, Ore., Feb. 17 – Avis Budget Car Rental, LLC priced a $600 million issue of eight-year senior notes (B3/B) at par to yield 5 3/8% in a Wednesday drive-by, according to market sources.
The yield printed at the tight end of yield talk in the 5½% area. Initial guidance was 5¾%.
Left bookrunner Morgan Stanley & Co. LLC will bill and deliver. Joint bookrunners were Citigroup Global Markets Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, BofA Securities Inc., Barclays, Credit Agricole CIB and Scotia Capital (USA) Inc.
The Parsippany-Troy Hills, N.J.-based vehicle rental company plans to use the proceeds to fully redeem its 10½% secured notes due 2025.
| Issuers: | Avis Budget Car Rental, LLC and Avis Budget Finance, Inc.
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| Amount: | $600 million
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| Maturity: | March 1, 2029
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| Securities: | Senior notes
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| Lead bookrunner: | Morgan Stanley & Co. LLC (bill and deliver)
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| Joint bookrunners: | Citigroup Global Markets Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, BofA Securities Inc., Barclays, Credit Agricole CIB and Scotia Capital (USA) Inc.
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| Co-managers: | MUFG, RBC Capital Markets LLC, Truist Securities Inc., BMO Capital Markets Corp., SMBC Nikko Securities America Inc., UniCredit Capital Markets LLC, BNP Paribas Securities Corp., Lloyds Securities Inc., Natixis Securities Americas LLC, NatWest Markets Securities Inc., SG Americas Securities LLC, HSBC Securities (USA) Inc., US. Bancorp Investments Inc., DNB and KBC Securities USA LLC
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| Coupon: | 5 3/8%
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| Price: | Par
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| Yield: | 5 3/8%
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| Spread: | 432 bps
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| First call: | Make-whole call at Treasuries plus 50 bps until March 1, 2024, then callable at 102.688
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| Equity clawback: | 40% at 105.375 until March 1, 2024
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| Trade date: | Feb. 17
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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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| Price talk: | 5½% area
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| Marketing: | Drive-by
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