Published on 10/5/2021 in the Prospect News Investment Grade Daily.
New Issue: FS KKR details $1.25 billion of notes due 2024, 2028
By Marisa Wong and Cristal Cody
Los Angeles, Oct. 5 – FS KKR Capital Corp. disclosed details of its $1.25 billion of notes (Baa3/BBB-/BBB) priced in two parts on Monday in an FWP filed Tuesday with the Securities and Exchange Commission.
The company priced $500 million of 1.65% three-year notes at 99.846 to yield 1.703%, or a spread of Treasuries plus 120 basis points. The notes priced below initial price talk in the 145 bps over Treasuries area, according to a market participant.
The company also sold $750 million of 3.125% seven-year notes at 99.682 to yield 3.176%, or a spread of Treasuries plus 190 bps, 20 bps lower than initial talk which had them in the Treasuries plus 210 bps area.
The 2024 notes have a make-whole call. The 2028 notes feature a make-whole call and then a par call.
BofA Securities Inc., BMO Capital Markets Corp., KKR Capital Markets LLC, MUFG and Truist Securities Inc. are the bookrunners.
Proceeds will be used for general corporate purposes, including debt repayment, as previously reported.
The Philadelphia-based business development company invests mainly in senior secured and subordinated debt of private middle-market U.S. companies.
| Issuer: | FS KKR Capital Corp.
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| Issue: | Notes
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| Amount: | $1.25 billion
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| Bookrunners: | BofA Securities Inc., BMO Capital Markets Corp., KKR Capital Markets LLC, MUFG and Truist Securities Inc.
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| Other underwriters: | ING Financial Markets LLC, J.P. Morgan Securities LLC, SMBC Nikko Securities America, Inc., HSBC Securities (USA) Inc., Mizuho Securities USA LLC; RBC Capital Markets LLC, BNP Paribas Securities Corp., Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, Morgan Stanley & Co. LLC, Santander Investment Securities Inc., SG Americas Securities, LLC, Barclays, Credit Suisse Securities (USA) LLC, Compass Point Research & Trading, LLC, ICBC Standard Bank plc, R. Seelaus & Co., LLC, Keefe, Bruyette & Woods, Inc. and U.S. Bancorp Investments, Inc.
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| Trade date: | Oct. 4
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| Settlement date: | Oct. 12
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| Ratings: | Moody’s: Baa3
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| S&P: BBB-
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| Fitch: BBB
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| Distribution: | SEC registered
|
|
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| 2024 notes
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| Amount: | $500 million
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| Maturity: | Oct. 12, 2024
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| Coupon: | 1.65%
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| Price: | 99.846
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| Yield: | 1.703%
|
| Spread: | Treasuries plus 120 bps
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| Call features: | Make-whole call at Treasuries plus 20 bps
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| Price talk: | Treasuries plus 145 bps area
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| Cusip: | 302635AJ6
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|
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| 2028 notes
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| Amount: | $750 million
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| Maturity: | Oct. 12, 2028
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| Coupon: | 3.125%
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| Price: | 99.682
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| Yield: | 3.176%
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| Spread: | Treasuries plus 190 bps
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| Call features: | Make-whole call at Treasuries plus 30 bps until Aug. 12, 2028, then par call
|
| Price talk: | Treasuries plus 210 bps area
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| Cusip: | 302635AK3
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