Hexion talks $460 million five-year secured notes at 10½% area yield, moves back timing to Tuesday

By Paul A. Harris

Portland, Ore., Jan. 23 – Hexion Inc. talked its $460 million offering of five-year first-priority senior secured notes to yield in the 10½% area, according to market sources.

Official talk comes tight to initial guidance in the high 10% to 11% area.

The deal is set to price on Tuesday, a timing change that keeps it in the market one day longer than expected, sources say. Earlier timing had the deal set to clear the market on Monday.

J.P. Morgan Securities LLC, Citigroup Global Markets Inc., BofA Merrill Lynch, Citizens Bank, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Goldman Sachs & Co. and Wells Fargo Securities LLC are the joint bookrunners for the Rule 144A and Regulation S offering.

The notes come with two years of call protection.

The issuing entity will be wholly owned subsidiary Hexion 2 U.S. Finance Corp.

The Columbus, Ohio-based producer of thermoset resins plans to use the proceeds to purchase or redeem a portion of its senior secured notes and for general corporate purposes.

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