Tenneco to price $500 million eight-year secured notes on Friday; initial talk high 8% area

By Paul A. Harris

Portland, Ore., Nov. 12 – Tenneco Inc. plans to price a $500 million offering of senior secured notes due Jan. 15, 2029 (existing ratings Ba3/B/BB) on Friday, according to market sources.

The deal, which was scheduled to be shopped on a late Thursday morning conference call with investors, comes with initial price guidance in the high 8% area.

BofA Securities Inc., Barclays, Citigroup Global Markets Inc., J.P. Morgan Securities LLC, MUFG and Wells Fargo Securities LLC are the joint bookrunners.

Truist Securities Inc., SMBC Nikko Securities America Inc., BNP Paribas Securities Corp., Capital One Securities Inc., CIBC World Markets Corp., Citizens Capital Markets Inc., Commerz Markets LLC, Fifth Third Securities Inc., HSBC Securities (USA) Inc., ING Financial Markets LLC, KBC Securities USA LLC, Mizuho Securities USA Inc., PNC Capital Markets LLC, RBC Capital Markets Corp., Santander Investment Securities Inc., TD Securities (USA) LLC and U.S. Bancorp Investments Inc. are the co-managers.

The Rule 144A and Regulation S for life notes, which have a tenor of approximately eight years, become callable after three years at par plus 50% of the coupon. They feature a three-year 40% equity clawback at par plus the coupon and a 101% poison put.

Tenneco intends to use the proceeds, together with cash on hand, to redeem all of its outstanding secured notes due 2022.

The Lake Forest, Ill.-based company manufactures vehicle parts for the original equipment markets and aftermarket.

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