The YPG Holdings treasury department has been working overtime; there were two announcements of interest today.
First, they are redeeming the 4.65% of 2011:
Yellow Pages Group announced today that YPG Holdings Inc. (the “Company”) intends to exercise its right to redeem all of its outstanding $150 million 4.65% Medium Term Notes, Series 6, due February 28, 2011 (CUSIP No. 98424ZAF14) (the “Series 6 Notes”) on the following terms:
Redemption Date: January 15, 2010;
Redemption Price: $1,041.681 per $1,000 principal amount;
Accrued and Unpaid Interest: $17.836 per $1,000 principal amount; and
Total Redemption Price and Accrued and Unpaid Interest: $1,059.517 per $1,000 principal amount.
The redemption price has been determined in accordance with the terms of the Series 6 Notes and the provisions of the trust indenture dated April 21, 2004 governing the Series 6 Notes. Interest accrued on the Series 6 Notes up to, but excluding, the redemption date will be paid on the redemption date. The Company plans to finance the redemption through its existing commercial paper program.
That’s a very fat price for a one-year, The Pricing Supplement for the Series 6 is on SEDAR dated 2006-2-22:
YPG Holdings shall be entitled, at its option, to redeem the Series 5 Notes and/or Series 6 Notes in whole at any time or in part from time to time, by giving prior notice of not less than 30 days and not more than 60 days to the holders thereof, at the greater of the “Canada Yield Price” (as defined herein) and par, together in each case with accrued and unpaid interest to but excluding the date fixed for redemption. “Canada Yield Price” shall mean a price equal to the price of the Series 5 Notes or Series 6 Notes, as the case may be, calculated on the banking day preceding the day on which the redemption is authorized by YPG Holdings to provide a yield from the date fixed for redemption to the maturity date of the Series 5 Notes or Series 6 Notes to be redeemed, as the case may be, equal to the “Government of Canada Yield” plus 0.50% in the case of the Series 5 Notes or the “Government of Canada Yield” plus 0.16% in the case of the Series 6 Notes.
Of particular interest to YPG.PR.B holders is news of their issue of 10-year bonds at 7.75%:
YPG Holdings sold C$300 million ($286 million) of 10-year medium term notes, according to a term sheet seen by Reuters on Wednesday.
The 7.75 percent notes, due March 2, 2010, were priced at C$100.00 to yield 7.753 percent, or 432.5 basis points over the Canadian government benchmark, the term sheet said.
The bookrunners of the sale were investment dealer arms of Royal Bank of Canada, Bank of Nova Scotia and Bank of Montreal.
The reported due date of 2010-3-2 is a typographical error. I am advised it’s really 2020-3-2.
I noted in July that a ten-year issue would increase confidence and now they’ve done it!
YPG.PR.B closed last night at 17.56-60 to yield 11.09-05%; it is retractible 2017-6-30 at 25.00, so it has a term of about 7.5 years. There may be some who argue that the seniority difference justifies a 335bp spread to bonds, but I’m not one of them!
YPG is tracked by HIMIPref™ but is relegated to the “Scraps” index on credit concerns. The MAPF Performance Report for October 2009 disclosed a position in YPG.PR.B.
Update, 2009-11-21: I should have linked to the post about the YPG.PR.A & YPG.PR.B Issuer Bid and its reality.