Uber preps USD 1.5bn debut bond offering, sets call for tomorrow – Update

[Editor’s note: This is an update of a Debtwire story published earlier today, to add additional intelligence in the second paragraph about the timing of an investor call.]

Uber is working with Morgan Stanley on outreach related to raising around USD 1.5bn via an unsecured bond deal, said two buysiders and two trading sources.

The company has outlined a dual-tranche structure that includes an eight-year non-call three piece whispered at 8% and a five-year non-call two piece at 7.5%, two of the sources said. An investor call will take place tomorrow (10 October) at around noon to discuss the deal, two of the sources added.

Some buysiders are comping a potential Uber debut bond deal to recent new issues from fellow early-stage businesses WeWork and Tesla.

WeWork placed a USD 702m 7.875% senior unsecured note due 2025 this past April. The bonds last traded at 96 to yield 8.686% on Friday (5 October), according to MarketAxess. Tesla’s USD 1.8bn 5.3% senior unsecured notes due 2025, priced in August 2017, traded today at 84.375 to yield 8.34%, down slightly from 85.5 on Friday (5 October).

Though Uber doesn’t currently have any high yield bonds, it has tapped the leveraged loan market – most recently in June for a repricing also led by Morgan Stanley. In that deal, the borrower repriced its USD 1.133bn TLB due 2023 to Libor+ 350bps (0% floor).

The term loan is quoted in the 100.275/100.725 context today, in line with recent levels, according to Markit.

Uber recently reached a USD 148m settlement agreement over allegations it concealed a 2016 data breach in violation of state laws.

TERMS:

  • Led by Morgan Stanley
  • USD 1.5bn senior unsecured notes offering
  • Eight-year, non-call three tranche whispered at 8%
  • Five-year, non-call two tranche whispered at 7.5%
  • Sector: technology
  • Business description: provides ride-hailing transportation software services
  • Privately owned

Representatives for Uber and Morgan Stanley, respectively, didn’t respond to inquiries.

2018 Debtwire

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