Published on 3/26/2012 in the Prospect News High Yield Daily.
New Issue: Avis sells $125 million tap of 8¼% notes due 2019 at 103.5 with 7.329% yield to worst
By Paul A. Harris
Portland, Ore., March 26 - Avis Budget Car Rental, LLC and Avis Budget Finance, Inc. priced a $125 million add-on to its 8¼% senior notes due Jan. 15, 2019 (expected ratings B2/B) at 103.5 on Monday, resulting in a 7.329% yield to worst, according to a syndicate source.
The yield to worst came in line with the 7 3/8% area guidance.
Barclays Capital Inc., Deutsche Bank Securities Inc., Bank of America Merrill Lynch and J.P. Morgan Securities LLC were the bookrunners for the quick-to-market add-on.
The Parsippany, N.J.-based vehicle rental company plans to use the proceeds to repay a portion of its 7 5/8% notes due 2014.
The original $400 million issue priced at par in October 2010. A previous $200 million add-on priced at 101 in November 2010, resulting in an 8.039% yield to worst.
| Issuer: | Avis Budget Car Rental, LLC and Avis Budget Finance, Inc.
|
| Face amount: | $125 million
|
| Proceeds: | $129,375,000
|
| Maturity: | Jan. 15, 2019
|
| Security description: | Add-on to 8¼% senior notes due Jan. 15, 2019
|
| Bookrunners: | Barclays Capital Inc., Deutsche Bank Securities Inc., Bank of America Merrill Lynch, J.P. Morgan Securities LLC
|
| Coupon: | 8¼%
|
| Price: | 103.5
|
| Yield to worst: | 7.329%
|
| Spread: | 569 bps
|
| Call features: | Make-whole call at Treasuries plus 50 bps until Oct. 15, 2014, then callable at 104.125, 102.063, par on and after Oct. 15, 2016
|
| Equity clawback: | 35% at 108.25 until Oct. 15, 2013
|
| Change-of-control put: | 101%
|
| Trade date: | March 26
|
| Settlement date: | March 29
|
| Expected ratings: | Moody's: B2
|
| Standard & Poor's: B
|
| Distribution: | Rule 144A and Regulation S with registration rights
|
| Price talk: | 7 3/8% area yield to worst
|
| Fungibility: | Fungible upon registration
|
| Marketing: | Quick to market
|
| Original issue: | $400 million price at par in October 2010
|
| Previous add-on: | $200 million priced at 101 in November 2010 resulting in an 8.039% yield to worst
|
| Total issue size: | $725 million
|
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