Ball has ‘excellent’ financials, flexibility to invest in business

By Devika Patel

Knoxville, Tenn., Oct. 6 – Ball Corp. reported an “excellent” financial position on Tuesday, with flexibility to invest in the business.

“Ball is in a fortunate place,” senior vice president and chief financial officer Scott C. Morrison said on the company’s 2020 investor day conference call on Tuesday.

“We came into these unprecedented times with a global pandemic in a position of strength.

“Our financial condition is excellent.

“We have flexibility to invest in our business when others may be more hesitant,” Morrison said.

On Aug. 10, Ball priced an upsized $1.3 billion issue of 10-year senior bullet notes (Ba1/BB+) at par to yield 2 7/8% in a drive-by.

The issue size increased from $1 billion.

The yield printed at the tight end of yield talk in the 3% area. Initial talk had the deal coming to yield in the low 3% area.

Demand for the paper was heard to be “insane,” a market source said at the time.

However, late Monday, the par pricing deal was wrapped around par, according to a trader, who surmised that some investors dropped out of the deal when pricing fell below 3%.

Joint active bookrunner Goldman Sachs & Co. LLC billed and delivered. Other active bookrunners were BofA Securities Inc., Citigroup Global Markets Inc. and Deutsche Bank Securities Inc. Passive bookrunners were BNP Paribas Securities Corp., Mizuho Securities USA Inc., Morgan Stanley & Co. LLC, Rabo Securities, SMBC Nikko Securities America Inc. and UniCredit Capital Markets LLC.

The Broomfield, Colo.-based provider of packaging solutions earmarked the proceeds to repay debt under its revolver and for general corporate purposes, including potential investments in strategic alliances and acquisitions, the repurchase or redemption of debt, including its notes due in 2022, working capital, share repurchases, pension contributions or capital expenditures.

Ball Corp.’s 2 7/8% coupon was the lowest since deals from entities related to General Motors Corp. and Ford Motor Co. brought junk-rated deals in the 2009 to 2012 time-frame, according to Prospect News data.

© 2015 Prospect News.
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