By Paul A. Harris
Portland, Ore., Feb. 10 – Asda priced £2.75 billion of high-yield notes backing the buyout of U.K.-based supermarket chain on Wednesday, according to market sources.
The biggest all-sterling deal in the history of the market, it included £2.25 billion of five-year secured notes (Ba2//BB) that priced at par to yield 3¼%, at the tight end of the 3¼% to 3½% yield talk. Initial guidance was in the mid-3% area. Barclays and Deutsche Bank had the physical books.
The deal also included £500 million of six-year unsecured notes (B1//B+) that priced at par to yield 4%, at the tight end of the 4% to 4¼% yield talk and deep inside of initial guidance in the high-4% to low-5% area. Barclays and Morgan Stanley were the physical bookrunners for the unsecured notes.
The deal was hugely oversubscribed, according to information supplied by the dealers.
The £2.75 billion overall amount of notes on offer played to £8.25 billion of orders across both tranches, with the greatest amount of investor interest in the secured tranche, with £5.5 billion of orders in the book. The £500 million unsecured tranche, meanwhile, played to £2.75 billion of orders, dealers say.
Barclays will bill and deliver for both tranches of notes.
The notes were sold via Bellis Acquisition Co. plc.
Debt financing for the buyout also includes an €840 million term loan.
Proceeds plus equity will be used to fund the acquisition of Leeds-based Asda by the Issa brothers and TDR Capital from Walmart Inc.
| Issuer: | Bellis Acquisition Co. plc
|
| Amount: | £2.75 billion
|
| Bill and deliver: | Barclays
|
| Joint bookrunners: | BofA, HSBC, Lloyds and Rabobank
|
| Co-manager: | Commerzbank
|
| Trade date: | Feb. 10
|
| Settlement date: | Feb. 24
|
| Distribution: | Rule 144A and Regulation S
|
| Marketing: | Roadshow
|
|
|
| Secured notes
|
| Amount: | £2.25 billion
|
| Maturity: | Feb. 16, 2026
|
| Coupon: | 3¼%
|
| Price: | Par
|
| Yield: | 3¼%
|
| Spread: | 310.8 bps
|
| Call protection: | Two years
|
| Ratings: | Moody's: Ba2
|
| Fitch: BB
|
| Price talk: | 3¼% to 3½%
|
| Physical bookrunners: | Barclays and Deutsche Bank
|
|
|
| Unsecured notes
|
| Amount: | £500 million
|
| Maturity: | Feb. 16, 2027
|
| Coupon: | 4%
|
| Price: | Par
|
| Yield: | 4%
|
| Spread: | 376.8 bps
|
| Call protection: | Two years
|
| Ratings: | Moody's: B1
|
| Fitch: B+
|
| Price talk: | 4% to 4¼%
|
| Physical bookrunners: | Barclays and Morgan Stanley
|
|
|
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