Arconic Announces Closing of $700 Million Notes Offering & $800 Million ABL Facility Replacing Existing Term Loan & Revolver ...
May 13 2020 - 4:15PM
Business Wire
Arconic Corp. (NYSE: ARNC) (“Arconic” or “the Company”)
announced today that it closed its offering of first lien notes
(the “Notes”) in the aggregate principal amount of $700 million at
6.000% interest per annum, with a maturity date of May 15,
2025.
The Company also replaced its cash flow revolver with a new
asset-based credit facility (the “ABL Facility”) with aggregate
commitments of $800 million. Deutsche Bank AG New York Branch is
Administrative Agent for the ABL Facility. Availability under the
ABL Facility is subject to a borrowing base calculation generally
based upon a set percentage of eligible accounts receivable and
inventory, less customary reserves.
Chief Executive Officer Tim Myers said, “This recapitalization
provides us with the right capital structure for our Company moving
forward. Demand for the Notes and participation in the ABL Facility
was exceptionally strong, and as a result, we were able to upsize
the recapitalization from $1.35 billion to $1.5 billion in the
aggregate without any increase to pricing.”
The Company used the net proceeds from the offering, together
with cash on hand, to prepay in full the obligations outstanding
under its senior secured first-lien term loan B facility, and
prepay in full the obligations outstanding under its revolving
credit facility and terminate in full the commitments thereunder.
The Notes and the ABL Facility are fully and unconditionally
guaranteed, jointly and severally, by each of the Company’s
wholly-owned domestic subsidiaries. Each of the Notes and the
related guarantees are secured on a first-priority basis by liens
on certain assets of the Company and the guarantors and on a
second-priority basis by certain other assets of the Company and
the guarantors that constitute first-priority collateral for the
ABL Facility. The ABL Facility is secured on a first-priority basis
by liens on accounts receivable, inventory and certain other ABL
priority collateral and on a second-priority basis by certain other
assets.
The Notes and related guarantees were sold in a private
placement to qualified institutional buyers in accordance with Rule
144A under the Securities Act of 1933, as amended (the “Securities
Act”), and outside the United States to non-U.S. persons in
accordance with Regulation S under the Securities Act.
The Notes and related guarantees have not been and will not be
registered under the Securities Act or the securities laws of any
other jurisdiction and may not be offered or sold in the United
States or to, or for the benefit of, U.S. persons absent
registration under, or an applicable exemption from, the
registration requirements of the Securities Act.
About Arconic Corporation
Arconic Corporation (NYSE: ARNC), headquartered in Pittsburgh,
Pennsylvania, is a leading provider of aluminum sheet, plate and
extrusions, as well as innovative architectural products, that
advance the ground transportation, aerospace, industrial, packaging
and building, and construction markets.
Forward-Looking Statements
This release contains statements that relate to future events
and expectations and as such constitute forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements include those containing such
words as “anticipates,” “believes,” “could,” “estimates,”
“expects,” “forecasts,” “goal,” “guidance,” “intends,” “may,”
“outlook,” “plans,” “projects,” “seeks,” “sees,” “should,”
“targets,” “will,” “would,” or other words of similar meaning. All
statements that reflect Arconic Corporation’s expectations,
assumptions or projections about the future, other than statements
of historical fact, are forward-looking statements, including the
Company’s capital structure and use of proceeds. These statements
reflect beliefs and assumptions that are based on Arconic
Corporation’s perception of historical trends, current conditions
and expected future developments, as well as other factors Arconic
Corporation believes are appropriate in the circumstances.
Forward-looking statements are not guarantees of future performance
and are subject to risks, uncertainties, and changes in
circumstances that are difficult to predict. Although Arconic
Corporation believes that the expectations reflected in any
forward-looking statements are based on reasonable assumptions, it
can give no assurance that these expectations will be attained and
it is possible that actual results may differ materially from those
indicated by these forward-looking statements due to a variety of
risks and uncertainties. Such risks and uncertainties include, but
are not limited to the risk factors summarized in Arconic
Corporation’s reports filed with the U.S. Securities and Exchange
Commission (SEC).
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version on businesswire.com: https://www.businesswire.com/news/home/20200513005776/en/
Investor Contacts Jason Secore Shane Rourke (412)
315-2984 Investor.Relations@arconic.com Media Contact Tracie
Gliozzi (412) 992-2525 Tracie.Gliozzi@arconic.com
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