Horizon Lines reprices at $10 per share Updated 10:35 a.m. ET, Tue Sep 27, 2005 Horizon Lines today repriced its initial public offering at $10 a share for 12.5 million shares of its common stock, down from the $15-17 a share for 15.6 million shares it had announced in its original SEC registration statement of Sept. 7. The repriced offering if successful would raise $125 million, short of the $154.5 million in debt the carrier said it planned to pay down in its original filing. The nation's largest Jones Act carrier lowered its IPO price after its underwriters' initial sales presentations failed to attract investors. Last week, the underwriters had said the offering price would be lowered to the $10-12 range; today's announcement prices the stock in the low end of that range. Horizon Lines also granted the underwriters a 30-day option to purchase up to 1,875,000 additional shares to cover over-allotments, if any. The Charlotte-based carrier had said originally it plans to use the net proceeds from the sale, together with available cash from its units, to reduce its high-cost debt. Horizon said in its Sept. 7 SEC registration that it planned to redeem $43.4 million of 11 percent senior discount notes due 2013 issued by H-Lines Finance Holding Corp., $48.9 million of outstanding 9 percent senior notes due 2012 and $62.2 million of outstanding shares of Series A preferred stock. In the event that the net proceeds from the IPO are less than $122.1 million, Horizon Lines will reduce the amount of the net proceeds from the offering applied to redeem the 9 percent senior notes or the 11 percent senior discount notes, the filing said. The offering is being made through an underwriting syndicate led by Goldman, Sachs & Co. and UBS Investment Bank who are acting as joint book-running managers of the offering. The co-managers are Bear, Stearns & Co. Inc., Deutsche Bank Securities Inc. and J.P. Morgan Securities Inc. Horizon Lines is owned by the private equity firm Castle Harlan, which purchased it from the Carlyle Group in 2004 for $650 million. The Carlyle Group had bought it in 2003 from CSX Lines, which had acquired it as part of CSX Corp.'s 1986 acquisition of Sea-Land Services and later turned it into its domestic carrier division as Horizon Services Group.
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