Alliance Data Systems Corporation Announces Proposed Offering of $500 Million of Senior Notes

Rhea-AI Summary

Alliance Data Systems Corporation (NYSE: ADS) announced a proposed offering of $500 million in senior notes due 2026. The offering, subject to market conditions, aims to assist in repaying $493 million of existing term loans under its credit agreement. The senior notes will be unsecured obligations guaranteed by its domestic subsidiaries, paying interest semi-annually. Notably, the notes will not be registered under the Securities Act, limiting their sale in the U.S. This initiative indicates Alliance Data's strategic financial management amid current market conditions.

Positive

• Proposed offering of $500 million in senior notes improving debt profile.
• Intended use of proceeds primarily for repaying $493 million of existing term loans.

Negative

• Senior notes will not be registered under the Securities Act, limiting marketability.
• Potential risks associated with market conditions affecting the successful offering.

COLUMBUS, Ohio, Sept. 17, 2020 /PRNewswire/ -- Alliance Data Systems Corporation (NYSE: ADS) ("Alliance Data") announced today that it proposes to offer, subject to market conditions and other factors, $500.0 million aggregate principal amount of senior notes due 2026 (the "Notes"). The Notes will be offered to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and to certain non-U.S. persons in accordance with Regulation S under the Securities Act (the "Notes Offering"). Alliance Data intends to use the net proceeds from the Notes Offering to repay $493.0 million of the outstanding indebtedness under the term loans provided for in its existing credit agreement (the "Credit Agreement").

The Notes will be general senior unsecured obligations of Alliance Data and will be guaranteed on a senior unsecured basis by each of its existing and future domestic subsidiaries that incurs or in any other manner becomes liable for any debt under Alliance Data's domestic credit facilities, including the Credit Agreement. The Notes will pay interest semi-annually.  The interest rate and other terms of the Notes are to be determined by negotiations between Alliance Data and the initial purchasers.

The Notes will not be registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from such registration requirements. Alliance Data is under no obligation, and has no intention, to register the Notes under the Securities Act or any state securities laws in the future.

This announcement is neither an offer to sell nor a solicitation of an offer to buy any of these securities and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale is unlawful.

About Alliance Data

Alliance Data^® is a leading provider of data-driven marketing, loyalty and payment solutions serving large, consumer-based industries. Alliance Data creates and deploys customized solutions that measurably change consumer behavior while driving business growth and profitability for some of today's most recognizable brands. Alliance Data helps its partners create and increase customer loyalty across multiple touch points using traditional, digital, mobile and emerging technologies. A FORTUNE 500 and S&P MidCap 400 company headquartered in Columbus, Ohio, Alliance Data consists of businesses that together employ over 8,500 associates at more than 50 locations worldwide.

Alliance Data's Card Services business is a provider of market-leading private label, co-brand, and business credit card programs. LoyaltyOne^® owns and operates the AIR MILES^® Reward Program, Canada's most recognized loyalty program, and Netherlands-based BrandLoyalty, a global provider of tailor-made loyalty programs for grocers. 

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements give our expectations or forecasts of future events and can generally be identified by the use of words such as "believe," "expect," "anticipate," "estimate," "intend," "project," "plan," "likely," "may," "should" or other words or phrases of similar import. Similarly, statements that describe our business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements we make regarding, and the guidance we give with respect to, the proposed Notes Offering, the anticipated use of proceeds in connection therewith, our anticipated operating or financial results, initiation or completion of strategic initiatives, future dividend declarations, and future economic conditions, including, but not limited to, fluctuation in currency exchange rates, market conditions and COVID-19 impacts related to relief measures for impacted borrowers and depositors, labor shortages due to quarantine, reduction in demand from clients, supply chain disruption for our reward suppliers and disruptions in the airline or travel industries.

We believe that our expectations are based on reasonable assumptions. Forward-looking statements, however, are subject to a number of risks and uncertainties that could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this release, and no assurances can be given that our expectations will prove to have been correct. These risks and uncertainties include, but are not limited to, factors set forth in the Risk Factors section in our Annual Report on Form 10-K for the most recently ended fiscal year, which may be updated in Item 1A of, or elsewhere in, our Quarterly Reports on Form 10-Q filed for periods subsequent to such Form 10-K. Our forward-looking statements speak only as of the date made, and we undertake no obligation, other than as required by applicable law, to update or revise any forward-looking statements, whether as a result of new information, subsequent events, anticipated or unanticipated circumstances or otherwise.

Contacts:
Alliance Data
Tiffany Louder – Investor Relations
214-494-3048
Tiffany.Louder@alliancedata.com  

Shelley Whiddon – Media
214-494-3811
Shelley.Whiddon@alliancedata.com

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SOURCE Alliance Data Systems Corporation

FAQ

What is the purpose of Alliance Data's proposed $500 million senior notes offering?

The purpose is to raise funds to repay $493 million of existing term loans.

When is the maturity date for the senior notes offered by Alliance Data?

The senior notes are due in 2026.

What are the risks associated with the senior notes offering by Alliance Data?

The risks include market conditions affecting the offering and the notes not being registered under the Securities Act.

Who can purchase the senior notes offered by Alliance Data?

The notes will be offered to qualified institutional buyers and certain non-U.S. persons.

What type of obligations are the senior notes issued by Alliance Data?

The senior notes will be general senior unsecured obligations of Alliance Data.