CLARIOS COMPLETES UPSIZED PRIVATE OFFERING OF $750 MILLION 6.750% SENIOR SECURED NOTES DUE 2028 AND UPSIZED $2.75 BILLION TERM LOAN FACILITY MATURING 2030

Rhea-AI Summary

Clarios successfully closed its offering of $750 million in senior secured notes due 2028 and a new tranche of term loans worth $2,750 million. The weighted average interest rate for the notes and term loans is expected to be approximately 7%. The proceeds were used to repay borrowings under the existing term loan facility.

Positive

• Clarios closed a successful offering of $750 million in senior secured notes
• The new term loan facility of $2,750 million provides additional funding
• Weighted average interest rate expected to be approximately 7%

Negative

• No negative takes found

MILWAUKEE, May 4, 2023 /PRNewswire/ -- Clarios Global LP ("Clarios" or the "Company") announced today that it successfully closed its offering of $750 million in aggregate principal amount of senior secured notes due 2028 (the "Notes") with a coupon of 6.750%. The Company also announced the closing of a new tranche of term loans (the "New Term Loan Facility") in an aggregate principal amount of $2,750 million at SOFR plus 3.75%. The New Term Loan Facility will mature in May 2030. The weighted average interest rate for the Notes and the New Term Loan Facility is expected to be approximately 7%, based on the current one-month Term SOFR swap rate for 5 years.

Clarios is owned by Brookfield Business Partners (NYSE: BBUC, BBU; TSX: BBUC, BBU.UN) together with institutional partners of Brookfield Asset Management (NYSE, TSX: BAM). Brookfield Business Partners is the flagship listed vehicle of the Private Equity Group of Brookfield Corporation (NYSE, TSX: BN).

The gross proceeds from the offering of the Notes, together with the borrowings under the New Term Loan Facility, were used to repay approximately $3,500 million of borrowings under the Company's existing term loan facility (the "Existing Term Loan Facility") maturing in April 2026. While the Existing Term Loan Facility currently has a margin of LIBOR plus 3.25%, it was expected to transition to SOFR plus a credit spread adjustment plus 3.25% in the coming months as LIBOR will cease to be published after June 30.

The Notes were issued by the Company and Clarios US Finance Company, Inc. (together, the "Issuers"). The Notes and the term loans under the New Term Loan Facility are guaranteed by Clarios International LP ("Holdings"), which owns all of the equity interests of the Issuers, and each of the Company's subsidiaries that are guarantors under the Company's existing credit agreements and the Issuers' existing 6.250% Senior Secured Notes due 2026, 4.375% Senior Secured Notes due 2026, 6.750% Senior Secured Notes due 2025 and 8.500% Senior Notes due 2027.

The Notes have not been and will not be registered under the Securities Act of 1933, as amended (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 registration under the Securities Act and applicable state securities laws. The Notes were offered in the United States only to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act and outside the United States to non-U.S. persons pursuant to Regulation S under the Securities Act. The Notes have not been and will not be qualified for distribution by prospectus under the securities laws of any province or territory of Canada and may only be offered, sold or subsequently transferred to a purchaser in Canada, pursuant to an exemption from the prospectus requirements of Canadian securities laws.

This news release shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities, in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

About Clarios: Clarios is a world leader in advanced energy storage solutions. We partner with our aftermarket and original equipment customers to meet increasing market demand for smarter applications on a global scale. Our approximately 16,800 employees develop, manufacture and distribute a portfolio of evolving battery technologies for virtually every type of vehicle. Our technologies deliver uniquely sustainable, next-generation performance, and bring reliability, safety and comfort to everyday lives. We add value at every link in the supply chain, ensuring that up to 99% of the materials in our batteries are recovered, recycled and reused, contributing to the progress of the communities we serve and the planet we all share.

About Brookfield: Brookfield Business Partners: Brookfield Business Partners is a global business services and industrials company focused on owning and operating high-quality businesses that provide essential products and services and benefit from a strong competitive position. Investors have flexibility to invest in Brookfield Business Partners either through Brookfield Business Corporation (NYSE, TSX: BBUC), a corporation, or Brookfield Business Partners L.P. (NYSE: BBU; TSX: BBU.UN), a limited partnership.

Brookfield Business Partners is the flagship listed vehicle of the Private Equity Group of Brookfield Corporation, a leading global alternative asset manager with approximately $800 billion of assets under management.

Forward-looking Statements

This news release may contain forward-looking statements. Forward-looking statements may generally be identified by the use of the words "anticipates," "expects," "intends," "plans," "should," "could," "would," "may," "will," "believes," "estimates," "potential," "target," or "continue" and variations or similar expressions. These statements are based upon the current expectations and beliefs of management and are subject to certain risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include, but are not limited to, general economic, credit and capital market conditions, the impact of COVID-19 and its collateral consequences, the potential impact of decreased demand from customers in the aftermarket retail channel and automotive industry, the technological evolution of the battery and automotive industries and the other risks and uncertainties discussed in the offering memorandum related to the Notes. Readers are cautioned not to place undue reliance on any of these forward-looking statements. These forward-looking statements speak only as of the date hereof. Clarios undertakes no obligation to update any of these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect actual outcomes, unless required by law.

Investor Contact: Kathie Campbell investorrelations@clarios.com 414-214-6593

Media Contact: Zach Peterson, Scott Fosgard Communications zach@fosgardpr.com 202-257-2750

View original content:https://www.prnewswire.com/news-releases/clarios-completes-upsized-private-offering-of-750-million-6-750-senior-secured-notes-due-2028-and-upsized-2-75-billion-term-loan-facility-maturing-2030--301816387.html

SOURCE Clarios

FAQ

What is the offering that Clarios closed?

Clarios closed an offering of $750 million in senior secured notes due 2028.

Who owns Clarios?

Clarios is owned by Brookfield Business Partners.

What is the weighted average interest rate for the notes and term loans?

The weighted average interest rate is expected to be approximately 7%.

What were the proceeds used for?

The proceeds were used to repay borrowings under the existing term loan facility.