Shearer’s Foods talks $500 million seven-year notes at 8 1/8% area; books close Wednesday

By Paul A. Harris

Portland, Ore., Jan. 30 – Fiesta Purchaser, Inc. talked its $500 million offering of seven-year senior secured notes (expected ratings B3/B) to yield in the 8 1/8% area.

The deal is in the market backing the buyout of Shearer’s Foods.

Official talk comes well inside of initial guidance in the 8½% area.

Books close at 10 a.m. ET on Wednesday.

The Rule 144A and Regulation S for life notes come with three years of call protection. A special call provision allows the issuer to redeem 10% of the notes annually at 103 during the non-call period.

Joint bookrunner UBS Securities LLC will bill and deliver. Deutsche Bank Securities Inc., BMO Capital Markets Corp., BNP Paribas Securities Corp., RBC Capital Markets LLC, TD Securities (USA) LLC and Goldman Sachs & Co. LLC are also joint bookrunners.

Citizens Capital Markets Inc., Macquarie Capital (USA) Inc., Mizuho Securities USA Inc., Natixis Securities Americas LLC, Rabo Securities USA Inc. and Stifel Nicolaus & Co. Inc. are the co-managers.

Proceeds will be used to support the buyout of Chip Intermediate Holding Co., LLC (Shearer’s Foods) by Clayton Dubilier & Rice, LLC from Ontario Teachers' Pension Plan Board and to repay Shearer’s debt.

Shearer's is an Ohio-based supplier to the snack industry.

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