Avis Budget driving by with $400 million eight-year senior notes; early talk in 6% area

By Paul A. Harris

Portland, Ore., June 19 – Avis Budget Group, Inc. plans to price a $400 million offering of eight-year senior notes in a quick-to-market Wednesday trade following a late-morning conference call with investors, according to market sources.

Initial talk has the deal coming to yield in the 6% area, a trader said.

BofA Securities Inc. is the left bookrunner. Citigroup Global Markets Inc., Morgan Stanley & Co. LLC and Scotia Capital are the joint bookrunners.

SunTrust Robinson Humphrey Inc., RBC Capital Markets LLC, BMO Securities and HSBC Securities (USA) Inc. are the co-managers.

The Rule 144A for life and Regulation S notes become callable after three years at par plus 50% of the coupon and feature a three-year 40% equity clawback at par plus the coupon and a 101% poison put.

The Parsippany, N.J.-based vehicle rental company plans to use the proceeds, together with cash on hand, to partially redeem its 5½% senior notes due 2023.

The issuing entities will be Avis Budget Car Rental, LLC and Avis Budget Finance, Inc., wholly owned subsidiaries of Avis Budget Group.

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