By Cristal Cody
Tupelo, Miss., April 11 – Avolon Holdings Ltd. subsidiary Avolon Holdings Funding Ltd. priced an upsized $2.5 billion of guaranteed senior notes (Baa3/BBB-/BBB-) in three tranches in a Rule 144A and Regulation S offering on Thursday, according to a market source and a news release.
The company sold $750 million of 3.625% three-year notes to yield 3.65% with a spread of 135 basis points over Treasuries.
A $1 billion tranche of 3.95% five-year notes priced with a 4.064% yield, or a spread of Treasuries plus 175 bps.
Avolon sold $750 million of 4.375% seven-year notes to yield 4.454% and a Treasuries plus 205 bps spread.
The notes priced on the tight side of guidance and were upsized from an initial launch of $1.8 billion of bonds.
Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, SunTrust Robinson Humphrey Inc. and Wells Fargo Securities LLC were the bookrunners.
Avolon held fixed income investor calls for the offering on Tuesday and Wednesday.
The notes are guaranteed by the parent company and certain subsidiaries.
Proceeds will be used for general corporate purpose and the repayment of outstanding legacy secured debt as part of the company’s plan to reduce the level of secured debt in its capital structure to 30% of total assets.
The aircraft leasing company is based in Dublin.
| Issuer: | Avolon Holdings Funding Ltd.
|
| Guarantor: | Avolon Holdings Ltd. and certain subsidiaries
|
| Amount: | $2.5 billion
|
| Description: | Senior notes
|
| Bookrunners: | Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, SunTrust Robinson Humphrey Inc. and Wells Fargo Securities LLC
|
| Trade date: | April 11
|
| Settlement date: | April 16
|
| Ratings: | Moody’s: Baa3
|
| S&P: BBB-
|
| Fitch: BBB-
|
| Distribution: | Rule 144A and Regulation S
|
| Marketing: | Fixed income investor calls
|
|
|
| Three-year notes
|
| Amount: | $750 million
|
| Description: | Fixed-rate notes
|
| Maturity: | May 1, 2022
|
| Coupon: | 3.625%
|
| Yield: | 3.65%
|
| Spread: | Treasuries plus 135 bps
|
| Price guidance: | Treasuries plus 140 bps area, plus or minus 5 bps; initial talk at Treasuries plus 165 bps area
|
|
|
| Five-year notes
|
| Amount: | $1 billion
|
| Description: | Fixed-rate notes
|
| Maturity: | July 1, 2024
|
| Coupon: | 3.95%
|
| Yield: | 4.064%
|
| Spread: | Treasuries plus 175 bps
|
| Price guidance: | Treasuries plus 180 bps area, plus or minus 5 bps; initial talk at Treasuries plus 200 bps area
|
|
|
| Seven-year notes
|
| Amount: | $750 million
|
| Description: | Fixed-rate notes
|
| Maturity: | May 1, 2026
|
| Coupon: | 4.375%
|
| Yield: | 4.454%
|
| Spread: | Treasuries plus 205 bps
|
| Price guidance: | Treasuries plus 210 bps area, plus or minus 5 bps; initial talk at Treasuries plus 230 bps area
|
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