By Paul A. Harris
Portland, Ore., March 29 – Ascent Resources Utica Holdings, LLC priced $1.5 billion of five-year senior notes (B3/B-) at par to yield 10% on Wednesday, according to a market source.
Previously in the market as a two-tranche deal, a proposed tranche of eight-year notes was withdrawn, and the entire $1.5 billion amount was consolidated into the single tranche.
The yield printed on top of final yield talk. However talk on the five-year notes widened steadily and significantly from early guidance of 7½% to 7¾%, sources said.
There are also covenant changes, sources said.
J.P. Morgan Securities LLC, Barclays, BMO Capital Markets, Credit Suisse Securities (USA) LLC, Goldman Sachs & Co. and Natixis Securities were the joint bookrunners.
ARU Finance Corp., a wholly owned subsidiary of Ascent Resources, is the co-issuer.
The Oklahoma City-based energy company plans to use the proceeds to retire its second-lien term loan and for general corporate purposes.
| Issuers: | Ascent Resources Utica Holdings, LLC and ARU Finance Corp.
|
| Amount: | $1.5 billion
|
| Maturity: | April 1, 2022
|
| Securities: | Senior notes
|
| Bookrunners: | J.P. Morgan Securities LLC, Barclays, BMO Capital Markets, Credit Suisse Securities (USA) LLC, Goldman Sachs & Co., Natixis Securities
|
| Senior co-manager: | ABN Amro
|
| Co-managers: | Fifth Third, Hancock
|
| Coupon: | 10%
|
| Price: | Par
|
| Yield: | 10%
|
| Spread: | 807 bps
|
| Call: | Make-whole call at Treasuries plus 50 bps until April 1, 2020, then callable at 107.5
|
| Equity clawback: | 35% at 110 until April 1, 2020
|
| Trade date: | March 29
|
| Settlement date: | April 5
|
| Ratings: | Moody's: B3
|
| S&P: B-
|
| Distribution: | Rule 144A and Regulation S
|
| Price talk: | 10%
|
| Marketing: | Roadshow
|
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