PEU/Pepco talks upsized €375 million five-year notes at 7½% area; pricing Wednesday

By Paul A. Harris

Portland, Ore., June 21 – PEU (FIN) Ltd., a wholly owned indirect subsidiary of Pepco Group NV, upsized its offering of five-year senior secured notes (Ba3//BB+) to €375 million from €300 million, according to a market source.

The Rule 144A and Regulation S deal is talked to yield in the 7½% area, inside of initial guidance in the high-7% area, and is expected to price on Wednesday.

The notes come with two years of call protection.

Citigroup, Goldman Sachs, ING and JPMorgan are the leads.

The U.K.-based retailer plans to use the proceeds plus balance sheet cash to repay bank debt.

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