Arko starts roadshow for $450 million eight-year senior notes; initial talk low 4% area

By Paul A. Harris

Portland, Ore., Oct. 12 – Arko Corp. started a roadshow on Tuesday for a $450 million offering of eight-year senior notes (expected ratings B3/B-), according to market sources.

Initial guidance has the notes coming to yield in the 4% area.

The deal was set to kick off on a Tuesday conference call with investors.

The roadshow runs through Thursday.

BofA Securities Inc., Capital One Securities Inc., KeyBanc Capital Markets Inc. and Santander Investment Securities Inc. are the joint bookrunners.

Citizens Capital Markets Inc., Fifth Third Securities Inc., M&T Securities Inc., PNC Capital Markets LLC, Raymond James & Associates and Truist Securities Inc. are the co-managers.

The notes become callable after three years at par plus 50% of the coupon. They feature a three-year 40% equity clawback at par plus the full coupon and have a 101% poison put.

The Richmond, Va.-based convenience store operator plans to use the proceeds to permanently pay off approximately $223 million outstanding under the Ares credit agreement, as well as to repay approximately $200 million of the outstanding obligations under the GPMP Capital One line of credit, with the remainder of the proceeds to be used for general corporate purposes.

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