Published on 8/9/2023 in the Prospect News High Yield Daily.
New Issue: TransDigm prices $1.45 billion secured notes due 2030 at par to yield 6 7/8%
By Paul A. Harris
Portland, Ore., Aug. 9 – TransDigm Inc. priced a $1.45 billion issue of senior secured notes due Dec. 15, 2030 (Ba3/B+) at par to yield 6 7/8% in a Wednesday drive-by, according to market sources.
The yield printed at the tight end of the 6 7/8% to 7% yield talk. Initial guidance was in the 7% area.
The deal, which played to $2.5 billion of demand, broke to par ¾ bid, according to a bond trader in New York.
Morgan Stanley & Co. LLC was at the left of a syndicate of joint bookrunners which included RBC Capital Markets Corp., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, Citigroup Global Markets Inc., KKR, Wells Fargo Securities LLC, Capital One Securities Inc., HSBC Securities (USA) Inc., Barclays, PNC Capital Markets LLC.
The Cleveland-based supplier of aircraft components plans to use the proceeds, with cash on hand, to redeem all of its 6 3/8% senior subordinated notes due 2026 and all of TransDigm Holdings UK plc’s 6 7/8% senior subordinated notes due 2026.
| Issuers: | TransDigm Inc.
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| Amount; | $1.45 billion
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| Maturity: | Dec. 15, 2030
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| Securities: | Senior secured notes
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| Bookrunners: | Morgan Stanley & Co. LLC, RBC Capital Markets Corp., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, Citigroup Global Markets Inc., KKR, Wells Fargo Securities LLC, Capital One Securities Inc., HSBC Securities (USA) Inc., Barclays, PNC Capital Markets LLC
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| Coupon: | 6 7/8%
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| Price: | Par
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| Yield: | 6 7/8%
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| Spread: | Treasuries plus 290 bps
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| First call: | Aug. 18, 2026 at 103.438
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| Trade date: | Aug. 9
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| Settlement date: | Aug. 18
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| Ratings: | Moody’s: Ba3
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| S&P: B+
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| Distribution: | Rule 144A for life and Regulation S
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| Price talk: | 6 7/8% to 7%
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| Marketing: | Drive-by
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