New Issue: United Refining prices $365 million 10½% seven-year notes at 96.444 to yield 11¼%

By Paul A. Harris

Portland, Ore., Feb. 25 - United Refining Co. priced a $365 million issue of 10½% seven-year first-priority senior secured notes (B3/B/) at 96.444 to yield 11¼%, an informed source said.

The yield printed on top of the yield talk. The reoffer price comes in line with discount talk of about 3.5 points.

Credit Suisse Securities ran the books.

The face amount of the issue was increased from $350 million, and the deal generated $352 million of proceeds.

The Warren, Pa.-based refiner and marketer of petroleum products plans to use the proceeds to fund the tender offer for its 10½% senior notes due 2012.

Issuer:	United Refining Co.
Face amount:	$365 million, increased from $350 million
Proceeds:	$352.02 million (approximate)
Maturity:	Feb. 28, 2018
Securities:	First-priority senior secured notes
Bookrunner:	Credit Suisse Securities
Co-managers:	RBC Capital Markets, PNC Capital Markets, Gleacher & Co. Securities
Coupon:	10½%
Price:	96.444
Yield:	11¼%
Spread:	838 bps
Call features:	Make-whole call at Treasuries plus 50 bps until Feb. 28, 2015, then callable at 105.25, 102.625, par on and after Feb. 28, 2017
Equity clawback:	35% at 110.50 until Feb. 28, 2014
Change-of-control put:	101%
Trade date:	Feb. 25
Settlement date:	March 8
Ratings:	Moody's: B3
	Standard & Poor's: B
Distribution:	Rule 144A and Regulation S with registration rights
Price talk:	11¼% including about 3.5 points OID
Marketing:	Roadshow

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