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Rain Carbon cuts notes to $550 million, adds lien, pricing Friday
By Paul A. Harris
Portland, Ore., March 16 – Rain Carbon Inc. circulated documents on a downsized, restructured $550 million offering of eight-year senior secured second lien notes on Thursday, according to market sources.
The deal is reduced from $1.05 billion.
The new structure brings second lien security to bear upon the notes, whereas the previous deal was unsecured.
The downsized, revamped offer is expected to price on Friday.
As before, Citigroup Global Markets Inc. is the left bookrunner for the Rule 144A and Regulation S for life offer. Deutsche Bank Securities Inc. and Goldman Sachs & Co. are the joint bookrunners.
The notes come with three years of call protection. The notes also feature a 101% poison put.
The restructuring also sees the premium of the three-year equity clawback decrease to par plus 35% of the coupon from 40%.
As before, the Stamford, Conn.-based producer of carbon-based and chemical products plans to use the proceeds to repay its existing 8% second lien notes due 2018.
With the downsizing, Rain Carbon will only partially repay its existing 8¼% second lien notes due 2021 rather than fully pay off those notes, as had been planned prior to the downsizing.
In addition the previous $1.05 billion deal would have also taken out the company’s 8½% euro-denominated notes due 2021 but those notes will now remain outstanding.
Nor have any proceeds been designated for general corporate purposes, as was the case previously.
In a separate announcement Rain Carbon said that its tender offer for the 8¼% notes is now capped at $115 million instead of covering the entire $360.78 million issue and that its offer to buy the euro notes has been canceled.
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