Published on 5/16/2019 in the Prospect News Investment Grade Daily.
New Issue: WestRock prices $1 billion of guaranteed senior notes in two tranches
By Cristal Cody
Tupelo, Miss., May 16 – WestRock Co. subsidiary WRKCo Inc. priced $1 billion of fixed-rate guaranteed senior notes (Baa2/BBB) in two tranches on Thursday, according to an FWP filed with the Securities and Exchange Commission.
The company sold $500 million of 3.9% notes due June 1, 2028 at 99.976 to yield 3.903%, or a spread of 150 basis points over Treasuries.
A $500 million tranche of 4.2% notes due June 1, 2032 priced at 99.969 to yield 4.203%. The notes priced with a spread of Treasuries plus 180 bps.
BofA Securities, Inc., Wells Fargo Securities, LLC, J.P. Morgan Securities LLC, Mizuho Securities USA LLC, Scotia Capital (USA) Inc., TD Securities (USA) LLC, BB&T Capital Markets, MUFG, Citigroup Global Markets Inc., HSBC Securities (USA) Inc., Rabo Securities USA, Inc., SunTrust Robinson Humphrey, Inc. and SMBC Nikko Securities America, Inc. were the bookrunners.
The notes will be fully and unconditionally guaranteed by WestRock Co., WestRock MWV, LLC and WestRock RKT, LLC.
Proceeds will be used on June 3 to redeem all $250 million of outstanding 7.375% notes due Sept. 1, 2019, redeem all of $350 million of outstanding 3.5% notes due March 1, 2020, reduce outstanding debt under the company’s three-year term loan under its delayed-draw credit facilities and under its commercial paper program and for general corporate purposes.
WestRock is an Atlanta-based paper and packaging manufacturer.
| Issuer: | WRKCo Inc.
|
| Guarantors: | WestRock Co., WestRock MWV, LLC and WestRock RKT, LLC
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| Amount: | $1 billion
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| Description: | Senior notes
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| Bookrunners: | BofA Securities, Inc., Wells Fargo Securities, LLC, J.P. Morgan Securities LLC, Mizuho Securities USA LLC, Scotia Capital (USA) Inc., TD Securities (USA) LLC, BB&T Capital Markets, MUFG, Citigroup Global Markets Inc., HSBC Securities (USA) Inc., Rabo Securities USA, Inc., SunTrust Robinson Humphrey, Inc. and SMBC Nikko Securities America, Inc.
|
| Co-managers: | BNY Mellon Capital Markets, LLC, Commerz Markets LLC, Fifth Third Securities, Inc., Goldman Sachs & Co. LLC, ING Financial Markets LLC, PNC Capital Markets LLC and U.S. Bancorp Investments, Inc.
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| Trade date: | May 16
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| Settlement date: | May 20
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| Ratings: | Moody’s: Baa2
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| S&P: BBB
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| Distribution: | SEC registered
|
|
|
| Nine-year notes
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| Amount: | $500 million
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| Maturity: | June 1, 2028
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| Coupon: | 3.9%
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| Price: | 99.976
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| Yield: | 3.903%
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| Spread: | Treasuries plus 150 bps
|
| Call features: | Make-whole call before March 1, 2028 at price equal to greater of par and Treasuries plus 25 bps; thereafter at par
|
| Change-of-control put: | 101%
|
|
|
| 13-year notes
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| Amount: | $500 million
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| Maturity: | June 1, 2032
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| Coupon: | 4.2%
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| Price: | 99.969
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| Yield: | 4.203%
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| Spread: | Treasuries plus 180 bps
|
| Call features: | Make-whole call before March 1, 2032 at price equal to greater of par and Treasuries plus 30 bps; thereafter at par
|
| Change-of-control put: | 101%
|
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