GCP Applied Technologies talks $525 million seven-year notes to yield 9½%-9¾%; pricing Friday

By Paul A. Harris

Portland, Ore., Jan. 21 – GCP Applied Technologies Inc., which is to be spun off from W. R. Grace & Co., talked its $525 million offering of seven-year senior notes (B1/B+) to yield 9½% to 9¾%, according to a syndicate source.

There have also been covenant changes.

Books close at 10 a.m. ET on Friday, and the deal is set to price later on Friday.

Goldman Sachs & Co. is the left bookrunner for the Rule 144A for life and Regulation S offering. Deutsche Bank Securities Inc., BofA Merrill Lynch and Citigroup Global Markets Inc. are the joint bookrunners.

HSBC, KeyBanc Capital Markets and PNC Capital Markets are the co-managers.

The notes come with three years of call protection.

The Columbia, Md.-based provider of specialty construction chemicals, building materials and packaging technologies plans to use the proceeds to fund a $500 million distribution to W.R. Grace & Co.-Conn., a direct subsidiary of W.R. Grace, and for general corporate purposes.

In a news release, W.R. Grace announced that its board of directors has approved the plan to separate its construction products segment and its Darex packaging technologies business from its remaining businesses to form GCP Applied Technologies. The planned separation is expected to be completed on Feb. 3.

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