By Paul A. Harris
Portland, Ore., Aug. 7 – ATI Inc. priced an upsized $425 million issue of seven-year senior notes (B2/B+) at par to yield 7¼% in a Monday drive-by, according to market sources.
The issue size increased from $400 million.
The yield printed at the tight end of the 7¼% to 7½% yield talk. Initial guidance was in the mid-7% area.
The deal was a blowout according to a sellside source who added that the $425 million issue was heard to have played to $1.9 billion of orders.
Citigroup Global Markets Inc. was the left bookrunner. Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC are joint bookrunners.
The notes are callable with a Treasuries plus 50 basis points make-whole premium until Aug. 15, 2026. Starting Aug. 15, 2026, they are callable at 103.625, stepping down to 101.813 after Aug. 15, 2027 and then par starting Aug. 15, 2028.
The Dallas-based supplier of high-performance materials and solutions for the global aerospace and defense markets plans to use the proceeds to fund $300 million of its pension liabilities and for general corporate purposes.
The incremental proceeds resulting from the $25 million upsize of the deal will also be used for general corporate purposes.
| Issuer: | ATI Inc.
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| Amount: | $425 million
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| Maturity: | Aug. 15, 2030
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| Securities: | Senior notes
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| Bookrunners: | Citigroup Global Markets Inc. (left), Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC
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| Co-managers: | BofA Securities, Inc., PNC Capital Markets LLC, MUFG Securities Americas Inc., Wells Fargo Securities LLC and HSBC Securities (USA) Inc.
|
| Coupon: | 7¼%
|
| Price: | Par
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| Yield: | 7¼%
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| Spread: | Treasuries plus 313 bps
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| Call: | Make-whole call before Aug. 15, 2026 at Treasuries plus 50 bps; starting Aug. 15, 2026 at 103.625; starting Aug. 15, 2027 at 101.813; after Aug. 15, 2028 at par
|
| Equity clawback: | Up to 40% at 107.25 before Aug. 15, 2026
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| Change of control: | At 101
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| Trade date: | Aug. 7
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| Settlement date: | Aug. 11
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| Ratings: | Moody’s: B2
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| S&P: B+
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| Distribution: | SEC registered
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| Marketing: | Drive-by
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| Cusip: | 01741RAN2
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| Price talk: | 7¼% to 7½%
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