Published on 2/2/2024 in the Prospect News High Yield Daily.
New Issue: Howden prices upsized $1.5 billion notes in secured and unsecured tranches
By Paul A. Harris
Portland, Ore., Feb. 2 – Howden Group (B2/B) made an upsized $1.5 billion two-part placement of high-yield notes on Friday, according to market sources.
The deal, which upsized from $1.25 billion, featured an upsized $1 billion tranche of Howden UK Refinance plc/Howden US Refinance LLC seven-year senior secured notes (B2/B) that priced at par to yield 7¼%. The tranche size increased from $750 million. The yield printed at the tight end of yield talk in the 7 3/8% area. Initial guidance was in the mid-7% area.
The deal also features a $500 million tranche of Howden UK Refinance 2 plc/Howden US Refinance LLC eight-year senior notes (Caa1/CCC+) that priced at par to yield 8 1/8%. The yield printed 12.5 basis points inside of yield talk in the 8 3/8% area. Initial guidance was in the mid-8% area.
Bookrunners were Morgan Stanley, JPMorgan, BofA, Barclays, Goldman Sachs, RBC, Citigroup, HSBC, ING, Lloyds, NatWest, Santander and Howden Capital Tiger Markets & Advisory.
The London-based insurance intermediary group plans to use the proceeds plus proceeds from concurrent dollar- and euro-denominated term loans to refinance a portion of its outstanding dollar-denominated term loan, to pay off its outstanding euro-denominated term loans, to pay off its second-lien facility and for general corporate purposes.
| Company: | Howden Group
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| Amount: | $1.5 billion, increased from $1.25 billion
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| Bookrunners: | Morgan Stanley, JPMorgan, BofA, Barclays, Goldman Sachs, RBC, Citigroup, HSBC, ING, Lloyds, NatWest, Santander and Howden Capital Tiger Markets & Advisory
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| Trade date: | Feb. 2
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| Settlement date: | Feb. 15
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| Distribution: | Rule 144A for life and Regulation S
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| Marketing: | Roadshow
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| Secured notes
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| Issuers: | Howden UK Refinance plc and Howden US Refinance LLC
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| Amount: | $1 billion, increased from $750 million
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| Issue: | Senior secured notes
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| Maturity: | Feb. 15, 2031
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| Coupon: | 7¼%
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| Price: | Par
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| Yield: | 7¼%
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| Spread: | 341 bps
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| Call protection: | Three years
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| Ratings: | Moody’s: B2
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| S&P: B
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| Price talk: | 7 3/8% area
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| Senior notes
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| Issuers: | Howden UK Refinance 2 plc and Howden US Refinance LLC
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| Amount: | $500 million
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| Issue: | Senior notes
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| Maturity: | Feb. 15, 2032
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| Coupon: | 8 1/8%
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| Price: | Par
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| Yield: | 8 1/8%
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| Spread: | 412 bps
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| Call protection: | Three years
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| Ratings: | Moody’s: Caa1
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| S&P: CCC+
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| Price talk: | 8 3/8% area
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