Yum! Brands driving by with $500 million 10-year notes; initial talk mid-to-high 5% area

By Paul A. Harris

Portland, Ore., March 24 – Yum! Brands, Inc. plans to price a $500 million public offering of 10-year senior notes (Ba3/BB) in a Thursday drive-by trailing a conference call with investors, according to market sources.

Initial guidance is in the mid-to-high 5% area.

The notes become callable after five years at par plus 50% of the coupon.

BofA Securities Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, Wells Fargo Securities LLC and Fifth Third Securities Inc. are the joint bookrunners.

Barclays, Capital One Securities Inc., ING Financial Markets LLC and MUFG are the senior co-managers.

BNP Paribas Securities Corp., HSBC Securities (USA) Inc., Huntington Investment Co., ICBC Standard Bank plc, PNC Capital Markets LLC, Rabo Securities USA Inc., Scotia Capital (USA) Inc., U.S. Bancorp Investments Inc. and Siebert Williams Shank & Co. LLC are the co-managers.

The trustee is U.S. Bank Trust Co., NA, according to a 424B5 filing with the Securities and Exchange Commission.

Counsel to the issuer is provided by Mayer Brown LLP and to the underwriters by Davis Polk & Wardwell LLP.

The Louisville, Ky.-based restaurant company plans to use the proceeds to redeem and retire its 7¾% senior notes due 2025 and for general corporate purposes.

Yum! operates KFC, Taco Bell, Pizza Hut and The Habit Burger Grill.

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