By Paul A. Harris
St. Louis, Aug. 1 - U.S. Shipping Partners LP and U.S. Shipping Finance Corp. priced a downsized $100 million issue of eight-year senior secured notes (Caa1/B-) at par to yield 13% on Tuesday, according to an informed source.
The issue, which was twice downsized during marketing (to $175 million from $200 million and ultimately to $100 million), priced with a yield that came 100 basis points beyond the original 11¾% to 12% price talk.
Lehman Brothers and CIBC World Markets were joint bookrunners for the Rule 144A and Regulation S issue.
Proceeds will be used to help fund the construction of the new articulated tug barge units (ATBs) and to fund an equity contribution to USS Product Carriers LLC.
According to an informed source, the company has both increased its bank deal and purchased an option to cancel one of the four ATBs it initially planned to build.
The company is an Edison, N.J., operator of a fleet of eight vessels, transporting refined petroleum products and chemicals.
| Issuers: | U.S. Shipping Partners LP and U.S. Shipping Finance Corp.
|
| Amount: | $100 million (decreased from $200 million)
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| Maturity: | Aug. 15, 2014
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| Security description: | Senior secured notes
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| Bookrunners: | Lehman Brothers, CIBC World Markets
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| Coupon: | 13%
|
| Price: | Par
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| Yield: | 13%
|
| Spread: | 806 bps
|
| Call features: | Make-whole call at Treasuries plus 50 basis points until Feb. 15, 2011, then callable 106.50, 103.25, par on and after Feb. 15, 2013
|
| Equity clawback: | Until Aug. 15, 2009 for 35% at 113.00
|
| Trade date: | Aug. 1
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| Settlement date: | Aug. 7
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| Ratings: | Moody's: Caa1
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| Standard & Poor's: B-
|
| Distribution: | Rule 144A/Regulation S
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| Price talk: | 11¾%-12%
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