By Cristal Cody and Paul A. Harris
Chicago, Nov. 23 – CDW LLC and CDW Finance Corp. sold $2.5 billion of senior notes (Ba2/BBB-/BBB-) in three parts on Tuesday, according to multiple sources and a 424B5 filing with the Securities and Exchange Commission early in the day.
The company priced $1 billion of 2.67% notes in a five-year tranche at a Treasuries plus 135 basis points spread. Initial price talk was in the Treasuries plus 150 basis points area, with the notes guided to 135 bps where they ultimately priced.
A $500 million 3.276% seven-year part priced with a Treasuries plus 170 bps spread, low to initial talk in the 180 bps area, but guided at 170 bps.
And, the longest tranche, the 10-year tranche, priced as $1 billion of 3.569% notes with a spread of Treasuries plus 190 bps, on top of 190 bps guidance and low to talk in the 200 bps area.
The notes will have a make-whole call followed by a par call.
J.P. Morgan Securities LLC, BofA Securities Inc., Wells Fargo Securities LLC, Morgan Stanley & Co. LLC, Capital One Securities Inc., Mizuho Securities USA Inc. and MUFG are the bookrunners.
Proceeds of the notes will be used to partially fund CDW’s acquisition of Granite Parent Inc., the indirect parent of Sirius Computer Solutions Inc. If the acquisition is not completed, there will be a special mandatory redemption of the notes at a redemption price equal to 101% of the principal amount of the notes plus accrued interest to the redemption date.
CDW is an information technology and cybersecurity company based in Lincolnshire, Ill.
| Issuers: | CDW LLC/CDW Finance Corp.
|
| Issue: | Senior notes
|
| Amount: | $2.5 billion
|
| Bookrunners: | J.P. Morgan Securities LLC, BofA Securities Inc., Wells Fargo Securities LLC, Morgan Stanley & Co. LLC, Capital One Securities Inc., Mizuho Securities USA Inc. and MUFG
|
| Co-managers: | Goldman Sachs & Co. LLC, Scotia Capital (USA) Inc., U.S. Bancorp Investments Inc. and Siebert Williams Shank & Co. LLC
|
| Special call: | At 101 if acquisition not completed
|
| Change of control: | At 101
|
| Trade date: | Nov. 23
|
| Settlement date: | Dec. 1
|
| Ratings: | Moody’s: Ba2
|
| S&P: BBB-
|
| Fitch: BBB-
|
| Distribution: | SEC registered
|
|
|
| Five-year
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| Amount: | $1 billion
|
| Maturity: | Dec. 1, 2026
|
| Coupon: | 2.67%
|
| Spread: | Treasuries plus 135 bps
|
| Call features: | Make-whole call then par call
|
| Price talk: | Initial price talk at 150 bps area; guided to 135 bps
|
|
|
| Seven-year
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| Amount: | $500 million
|
| Maturity: | Dec. 1, 2028
|
| Coupon: | 3.276%
|
| Spread: | Treasuries plus 170 bps
|
| Call features: | Make-whole call then par call
|
| Price talk: | Initial price talk at 180 bps area; guided to 170 bps
|
|
|
| 10-year
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| Amount: | $1 billion
|
| Maturity: | Dec. 1, 2031
|
| Coupon: | 3.569%
|
| Spread: | Treasuries plus 190 bps
|
| Call features: | Make-whole call then par call
|
| Price talk: | Initial price talk at 200 bps area; guided to 190 bps
|
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