Published on 3/16/2021 in the Prospect News High Yield Daily.
New Issue: Yum! Brands prices upsized $1.1 billion 10.75-year notes at par to yield 4 5/8%
By Paul A. Harris
Portland, Ore., March 16 – Yum! Brands, Inc. priced an upsized $1.1 billion issue of 10.75-year senior notes (B1/BB-) at par to yield 4 5/8% in a Tuesday drive-by, according to market sources.
The issue size increased from $1.05 billion.
The yield printed in the middle of the 4½% to 4¾% yield talk. Initial guidance was in the 4¾% area.
Citigroup Global Markets Inc. was the lead bookrunner. Joint bookrunners were Wells Fargo Securities LLC, J.P. Morgan Securities LLC, BofA Securities Inc., Goldman Sachs & Co. LLC and Barclays.
The Louisville, Ky.-based fast food company plans to use the proceeds to repay its 5¼% notes due 2026.
| Issuer: | Yum! Brands, Inc.
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| Amount: | $1.1 billion, increased from $1.05 billion
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| Maturity: | Jan. 31, 2032
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| Securities: | Senior notes
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| Lead bookrunner: Citigroup Global Markets Inc.
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| Joint bookrunners: | Wells Fargo Securities LLC, J.P. Morgan Securities LLC, BofA Securities Inc., Goldman Sachs & Co. LLC and Barclays
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| Senior co-managers: | Fifth Third Securities Inc., MUFG, ING Financial Markets LLC and Capital One Securities Inc.
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| Co-managers: | Scotia Capital (USA) Inc., Rabo Securities USA Inc., PNC Capital Markets LLC, U.S. Bancorp Investments Inc., ICBC Standard Bank plc, HSBC Securities (USA) Inc., BNP Paribas Securities Corp. and Siebert Williams Shank & Co. LLC
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| Coupon: | 4 5/8%
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| Price: | Par
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| Yield: | 4 5/8%
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| Spread: | 301 bps
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| First call: | Make-whole call at Treasuries plus 50 bps until Oct. 1, 2026, then callable at 102.313 in 2026; 101.542 in 2027; 100.771 in 2028; par thereafter
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| Change of control put: | At 101
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| Trade date: | March 16
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| Settlement date: | April 1
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| Ratings: | Moody's: B1
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| S&P: BB-
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| Distribution: | SEC registered
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| Price talk: | 4½% to 4¾%
|
| Marketing: | Drive-by
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