Specialty chemicals producer Solutia has priced a public offering of $400 million aggregate principal amount of senior unsecured notes, or $100 million more than previously announced.
In the new offering, the notes due on 2017 will bear an interest rate of 8.75 percent per annum. Solutia expects to close the offering on October 15.
Solutia anticipates net proceeds of approximately $391 million after deducting underwriting discounts and commissions. The company intends to use the funds raised from the offering mainly to prepay $300 million aggregate principal amount of its senior secured term loan.
Deutsche Bank Securities Inc., Kefferies & Company, Citigroup Global Markets Inc. and J.P. Morgan Securities Inc. are the joint book-running managers of the offering.
Solutia has also received lender approval for amendments to its asset-based lending and term loan credit agreements, which would become effective once a portion of the net proceeds from the offering is used to prepay the term loan. The amendments will provide the company with greater operational and strategic flexibility and increase its liquidity and covenant cushion.
Based in St. Louis, Missouri, Solutia is a leading provider of specialty chemicals. The company, listed on the New York Stock Exchange, has already signed numerous contracts to supply Therminol heat transfer fluid to solar power plants globally, including power plants in Morroco and Algeria.
Solutia prices $ 400 million senior unsecured notes
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