Bombardier Announces Pricing of its New Issuance of Senior Notes due 2032

Rhea-AI Summary

Bombardier has priced a new issuance of US$750 million Senior Notes due June 1, 2032, with an annual coupon rate of 7.000%. The issuance, expected to close by June 5, 2024, aims to repay and retire outstanding debt, including US$338 million of 7.125% Senior Notes due 2026 and US$450 million of 7.875% Senior Notes due 2027. Current outstanding principal amounts are US$504 million for the 2026 Notes and US$1,433 million for the 2027 Notes. The completion of these transactions is contingent upon market conditions. Proceeds will also cover accrued interest and related fees. The new notes are available to qualified institutional buyers in the U.S. and accredited investors in Canada.

Positive

• Bombardier successfully priced a US$750 million issuance of Senior Notes.
• New Senior Notes carry a 7.000% annual coupon rate.
• Proceeds will be used to repay and retire higher interest debt.
• Issuance expected to close by June 5, 2024.

Negative

• Completion of the issuance and redemptions is subject to market conditions.
• Current high levels of outstanding debt: US$504 million (2026 Notes) and US$1,433 million (2027 Notes).
• No assurance of successful completion of the transactions.

MONTRÉAL, May 21, 2024 (GLOBE NEWSWIRE) -- Bombardier Inc. (“Bombardier”) today announced that it has successfully priced its offering of US$750 million aggregate principal amount of new Senior Notes due June 1, 2032. The new Senior Notes will carry a coupon of 7.000% per annum and will be sold at par (the “New Notes”). The issuance of the New Notes is expected to close on or about June 5, 2024, subject to customary closing conditions.

Bombardier intends to use the proceeds of the offering of the New Notes, together with cash on hand, (i) to fund the repayment and/or retirement of outstanding indebtedness, including the redemption of US$338 million aggregate principal amount of its outstanding 7.125% Senior Notes due 2026 (the “2026 Notes”, and such redemption, the “Conditional 2026 Notes Redemption”) and the redemption of US$450 million aggregate principal amount of its outstanding 7.875% Senior Notes due 2027 (the “2027 Notes”, and such redemption, the “Conditional 2027 Notes Redemption”), and (ii) to pay accrued interest and related fees and expenses. As of the date hereof, there is US$504 million aggregate principal amount outstanding of the 2026 Notes and US$1,433 million aggregate principal amount outstanding of the 2027 Notes.

Consummation of the offering of the New Notes, the Conditional 2026 Notes Redemption and the Conditional 2027 Notes Redemption are subject to market and other conditions, and there can be no assurance that Bombardier will be able to successfully complete these transactions on the terms described above, or at all. Bombardier today intends to issue the notice of redemption in respect of the Conditional 2026 Notes Redemption and the notice of redemption in respect of the Conditional 2027 Notes Redemption, which redemptions will be subject to certain conditions, including the completion of the offering of the New Notes prior to the redemption dates set forth in such notices of redemption.

This press release does not constitute an offer to sell or buy or the solicitation of an offer to buy or sell any security and shall not constitute an offer, solicitation, sale or purchase of any securities in any jurisdiction in which such offering, solicitation, sale or purchase would be unlawful.

The New Notes mentioned herein have not been and will not be registered under the United States Securities Act of 1933, as amended, any state securities laws or the laws of any other jurisdiction, and may not be offered or sold in the United States absent registration or an applicable exemption from such registration requirements. The New Notes mentioned herein may be offered and sold in the United States only to persons reasonably believed to be qualified institutional buyers in accordance with Rule 144A under the U.S. Securities Act and outside the United States in reliance on Regulation S under the U.S. Securities Act. The New Notes mentioned herein have not been and will not be qualified for distribution to the public under applicable Canadian securities laws and, accordingly, any offer and sale of the securities in Canada will be made on a basis which is exempt from the prospectus requirements of such securities laws. The New Notes will be offered and sold in Canada on a private placement basis only to “accredited investors” pursuant to certain prospectus exemptions.

This announcement does not constitute an offer to purchase or the solicitation of an offer to sell the New Notes, the 2026 Notes or the 2027 Notes. This announcement does not constitute a redemption notice in respect of any 2026 Notes, 2027 Notes or any other notes. Any redemption of the 2026 Notes, the 2027 Notes or any other notes will be made pursuant to a notice of redemption under the indentures governing such notes.

FORWARD-LOOKING STATEMENTS

Certain statements in this announcement are forward-looking statements based on current expectations. By their nature, forward-looking statements require us to make assumptions and are subject to important known and unknown risks and uncertainties, which may cause our actual results in future periods to differ materially from those set forth in the forward-looking statements.

For information

Francis Richer de La Flèche Vice President, Financial Planning and Investor Relations Bombardier +1 514 240 9649

Mark Masluch Senior Director, Communications Bombardier +1 514 855 7167

FAQ

What is the coupon rate for Bombardier's new Senior Notes due 2032?

The new Senior Notes have an annual coupon rate of 7.000%.

When is Bombardier's new Senior Notes issuance expected to close?

The issuance is expected to close on or about June 5, 2024.

What will Bombardier use the proceeds from the new Senior Notes issuance for?

Bombardier intends to use the proceeds to repay and retire outstanding indebtedness, including US$338 million of 7.125% Senior Notes due 2026 and US$450 million of 7.875% Senior Notes due 2027.

How much is the aggregate principal amount of Bombardier's new Senior Notes?

The aggregate principal amount is US$750 million.

What are the conditions for the completion of Bombardier's new Senior Notes issuance?

Completion is subject to customary closing conditions and market conditions.