New Issue: J. Ray McDermott sells $200 million 10-year notes to yield 11½%

By Paul A. Harris

St. Louis, Nov. 21 - J. Ray McDermott, SA sold $200 million of 11% senior secured notes due Dec. 15, 2013 (B3/B-) at 97.064 on Friday to yield 11½%, according to a source close to the deal.

Price talk was for a yield of 11¼%-11½%.

Morgan Stanley was the bookrunner on the Rule 144A/Regulation S issue.

Proceeds will be used for general corporate purposes.

The issuer is a subsidiary of New Orleans-based energy services company McDermott International Inc.

Issuer:	J. Ray McDermott, SA
Amount:	$200 million
Maturity:	Dec. 15, 2013
Security description:	Senior secured notes
Bookrunner:	Morgan Stanley
Coupon:	11%
Price:	97.064
Yield:	11½%
Spread:	737 basis points
Call features:	Callable after Dec. 15, 2008 at 105.5, then 103.667, 101.833, declining to par on Dec. 15, 2011 and thereafter
Equity clawback:	Until Dec. 15, 2006 for 35% at 111.0
Settlement date:	Dec. 8(T+10)
Ratings:	Moody's: B3
	Standard & Poor's: B-
Rule 144A Cusip:	580043AB3
Price talk:	11¼%-11½%

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