NEW YORK -- United Rentals, Nations-Rent, National Equipment Services and Neff Rental grossed a combined $700 million in separate high-yield bond offerings last month. In addition, Rental Service Corp. expanded its revolving credit facility by $150 million.
While the cash infusions will be used to repay higher-cost debt and fill out fleets, a good portion is expected to be earmarked for acquisitions.
"We estimate that this deal will enable United to purchase at least $200 million to $225 million in additional annual revenue next year, possibly more if it is able to continue driving down acquisition prices," Goldman Sachs, the underwriter of the $300 million United deal, stated in a research report.
A closer look at the deals:
* Greenwich, Conn.-based United Rentals, the equipment rental industry's largest company, raised $300 million selling 10-year notes due 2009 with a 9.25 percent coupon.
* Fort Lauderdale, Fla.-based Nations-Rent, one of the industry's fastest-growing consolidators, raised $175 million - $25 million more than sources expected - with the sale of 10-year notes with a 10.375 percent coupon.
* Evanston, Ill.-based National Equip-ment Services, ranked No. 7 on the RER 100, raised $125 million selling five-year senior subordinated notes due 2004 with a coupon of 10 percent.
* Miami-based Neff Corp., whose Neff Rental is ranked No. 9 on the RER 100, sold $100 million in 10-year notes due in 2008 at 10.25 percent.
* Scottsdale, Ariz.-based Rental Service Corp., No. 4 on the RER 100, completed a $150 million expansion of its revolving credit facility.
