Published on 3/4/2016 in the Prospect News Investment Grade Daily.
New Issue: Stryker details $3.5 billion four-part issuance of senior notes
By Aleesia Forni
New York, March 4 – Stryker Corp. detailed its $3.5 billion offering of senior notes (Baa1/A+) that priced in four parts on Thursday, according to an FWP filed with the Securities and Exchange Commission.
A $750 million 2% tranche of three-year notes sold at 99.884 to yield 2.04%, or Treasuries plus 105 basis points.
Also, $750 million of 2.625% five-year notes sold with a spread of Treasuries plus 130 bps. Pricing was at 99.962 to yield 2.633%.
The company also priced $1 billion of 3.5% 10-year bonds at 99.348 to yield 3.578%, or Treasuries plus 175 bps.
Finally, $1 billion of 4.625% 30-year bonds sold with a 205 bps spread over Treasuries. The issue priced at 98.894 to yield 4.694%.
A floating-rate tranche of three-year notes was dropped prior to the deal’s launch.
BofA Merrill Lynch, Citigroup Global Markets Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC, BNP Paribas Securities Corp., Mizuho Securities USA Inc. and Wells Fargo Securities, LLC are the bookrunners.
Proceeds will be used to fund the acquisitions of Sage Products Holdings II, LLC and Physio-Control International Inc. The company will also use proceeds to repay its 2% notes due Sept. 30, 2016 and for general corporate purposes.
Stryker is a medical technology company based in Kalamazoo, Mich.
| Issuer: | Stryker Corp.
|
| Issue: | Senior notes
|
| Amount: | $3.5 billion
|
| Bookrunners: | BofA Merrill Lynch, Citigroup Global Markets Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC, BNP Paribas Securities Corp., Mizuho Securities USA Inc., Wells Fargo Securities, LLC
|
| Senior co-managers: | Barclays, HSBC Securities (USA) Inc., Morgan Stanley & Co. LLC, MUFG
|
| Co-managers: | PNC Capital Markets LLC, U.S. Bancorp Investments, Inc., Williams Capital Group, LP
|
| Change-of-control put: | 101%
|
| Trade date: | March 3
|
| Settlement date: | March 10
|
| Ratings: | Moody’s: Baa1
|
| Standard & Poor’s: A+
|
| Distribution: | SEC registered
|
|
|
| Three-year notes
|
| Amount: | $750 million
|
| Maturity: | March 8, 2019
|
| Coupon: | 2%
|
| Price: | 99.884
|
| Yield: | 2.04%
|
| Spread: | Treasuries plus 105 bps
|
| Price guidance: | Treasuries plus 110 bps area, tightened from Treasuries plus 135 bps area
|
| Make-whole call: Treasuries plus 15 bps
|
|
|
| Five-year notes
|
| Amount: | $750 million
|
| Maturity: | March 15, 2021
|
| Coupon: | 2.625%
|
| Price: | 99.962
|
| Yield: | 2.633%
|
| Spread: | Treasuries plus 130 bps
|
| Price guidance: | Treasuries plus 135 bps area, tightened from Treasuries plus 160 bps area
|
| Make-whole call: Treasuries plus 20 bps prior to Feb. 15, 2021, then callable at par
|
|
|
| 10-year notes
|
| Amount: | $1 billion
|
| Maturity: | March 15, 2026
|
| Coupon: | 3.5%
|
| Price: | 99.348
|
| Yield: | 3.578%
|
| Spread: | Treasuries plus 175 bps
|
| Price guidance: | Treasuries plus 180 bps area, tightened from Treasuries plus 210 bps area
|
| Make-whole call: Treasuries plus 25 bps prior to Dec. 15, 2025, then callable at par
|
|
|
| 30-year notes
|
| Amount: | $1 billion
|
| Maturity: | March 15, 2046
|
| Coupon: | 4.625%
|
| Price: | 98.894
|
| Yield: | 4.694%
|
| Spread: | Treasuries plus 205 bps
|
| Price guidance: | Treasuries plus 210 bps area, tightened from Treasuries plus 250 bps area
|
| Make-whole call: Treasuries plus 30 bps prior to Sept. 15, 2045, then callable at par
|
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