Underwriters on Thursday afternoon had altered the structure of the deal, increasing a five-year first-lien bond offering to $900 million from $500 million and decreasing a first-lien bank term loan by an equivalent amount to $500 million, according to a person familiar with the deal, due to heavy investor demand for the first-lien bonds.
The $900 million tranche of first-lien notes due Jan. 15, 2016 sold at par to yield 7.625%, compared to earlier price guidance of 7.75%
A $600 million tranche of second-lien pay-in-kind notes due Jan. 15, 2017 sold at par with a coupon of 10.75% when interest is paid in cash and 11.5% when paid in kind with more debt. The first three semiannual interest payments will be paid in kind, and thereafter the company will have the option to pay in cash, in kind or half in cash and half in kind, according to the person familiar with the deal.
Earlier price guidance for the $600 million of six-year second-lien notes was in the area of 10.75% to 11% if paid in cash, stepping up by 75 basis points if paid in kind with additional debt.
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