Teekay downsizes to $250 million, trims maturity; three-year secured notes guided to low 9% area

By Paul A. Harris

Portland, Ore., May 1 – Teekay Corp. downsized its offering of senior secured notes (B2/B+) to $250 million from $300 million, according to a market source.

The maturity of the notes decreased to three years from five years.

Pricing indications have the revamped deal coming with a yield in the low 9% area. Pricing on the previous five-year structure was 10% to 10¼%.

The Rule 144A and Regulation S for life deal is expected to price on Wednesday or Thursday.

J.P. Morgan Securities LLC, DNB Markets, Inc., BofA Merrill Lynch, Citigroup Global Markets Inc., Credit Agricole CIB and Morgan Stanley & Co. LLC are the joint bookrunners. Nordea is the co-manager.

Call protection on the notes remains unchanged at two years, the source said.

The Hamilton, Bermuda-based company plans to use the proceeds to fund a tender offer for its 8½% senior notes due 2020.

Teekay provides international crude oil and gas marine transportation services and offshore production and logistics.

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