BorgWarner Announces Full Redemption of its €500 Million 1.80% Senior Notes Due 2022

Rhea-AI Summary

BorgWarner Inc. (NYSE: BWA) announced the full redemption of its outstanding €500 million 1.80% Senior Notes due 2022 on June 18, 2021. The total redemption price will include 100% of the principal amount and any unpaid interest up to the redemption date, along with a Make-Whole Amount. This redemption is conducted through Euroclear and Clearstream banking systems, with DB Services Americas acting as the paying agent. The necessary approvals for this redemption have been secured, ensuring a smooth process.

Positive

• The full redemption of €500 million Senior Notes potentially improves the company's debt profile.
• Secured necessary approvals for the redemption, indicating strong corporate governance.

Negative

• The company will incur a financial obligation to cover the Make-Whole Amount, affecting cash flow.

AUBURN HILLS, Mich., May 19, 2021 /PRNewswire/ -- BorgWarner Inc. (NYSE: BWA) ("BorgWarner" or the "Company") announced today that it will redeem in full the entire outstanding €500 million aggregate principal amount of its 1.80% Senior Notes due 2022 (the "2022 Notes") on June 18, 2021 (the "Redemption Date"). The redemption is in accordance with the terms of the Indenture, dated as of September 23, 1999, between Borg-Warner Automotive, Inc. and The Bank of New York Mellon Trust Company, N.A. (successor in interest to Chase Manhattan Trust Company, National Association), as trustee, as supplemented by that Fifth Supplemental Indenture, dated as of November 6, 2015, between the Company and Deutsche Bank Trust Company Americas, as the indenture trustee (the "Trustee").

All outstanding 2022 Notes (NYSE: BWA22) (ISIN: XS1317708805) will be redeemed on the Redemption Date. The total redemption price is the sum of (i) 100% of the principal amount of the 2022 Notes being redeemed plus unpaid interest, if any, accrued thereon to, but excluding, the Redemption Date; and (ii) the Make-Whole Amount with respect to such 2022 Notes.

The 2022 Notes are held though Euroclear Bank S.A./N.V. ("Euroclear") and Clearstream Banking, société anonyme ("Clearstream") and will be redeemed in accordance with the procedures of Euroclear and Clearstream. The Trustee is acting as the paying agent. The address for the paying agent is as follows:

DB Services Americas, Inc.
5022 Gate Parkway South
Jacksonville, Florida 32256
Attention: Redemption Unit

The Company has received all necessary approvals for this redemption.

About BorgWarner
BorgWarner is a global product leader in clean and efficient technology solutions for combustion, hybrid and electric vehicles. Building on its original equipment expertise, BorgWarner also brings market leading product and service solutions to the global aftermarket. With manufacturing and technical facilities in 96 locations in 24 countries, the Company employs approximately 50,000 worldwide. For more information, please visit borgwarner.com.

Notice Regarding Forward-Looking Statements
Statements contained or incorporated by reference in this press release may contain forward-looking statements as contemplated by the 1995 Private Securities Litigation Reform Act, 27A of the U.S. Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the U.S. Securities Exchange Act of 1934, as amended (the "Exchange Act") that are based on management's current outlook, expectations, estimates and projections. Words such as "anticipates," "believes," "continues," "could," "designed," "effect," "estimates," "evaluates," "expects," "forecasts," "goal," "guidance," "initiative," "intends," "may," "outlook," "plans," "potential," "project," "predicts," "pursue," "seek," "should," "target," "when," "will," "would," and variations of such words and similar expressions are intended to identify such forward-looking statements. All forward-looking statements are based on assumptions and analyses made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors the Company believes are appropriate in the circumstances. Forward-looking statements are not guarantees of performance and the Company's actual results may differ materially from those expressed, projected or implied in or by the forward-looking statements. You should not place undue reliance on these forward-looking statements. Forward-looking statements are subject to risks and uncertainties, many of which are difficult to predict and generally beyond the Company's control, that could cause actual results to differ materially from those expressed, projected or implied in or by the forward-looking statements. These risks and uncertainties, include, among others: uncertainties regarding the extent and duration of impacts of matters associated with COVID-19/coronavirus ("COVID-19"), including additional production disruptions; the failure to realize the expected benefits of the acquisition of Delphi Technologies PLC that the Company completed on October 1, 2020; the failure to promptly and effectively integrate acquired business; the potential for unknown or inestimable liabilities relating to acquired business; the possibility that the proposed transaction between the Company and AKASOL AG ("Proposed Transaction") will not be consummated; failure to satisfy any of the conditions to the proposed transaction; failure to realize the expected benefits of the Proposed Transaction; the Company's dependences on automotive and truck production, both of which are highly cyclical and subject to disruptions; the Company's reliance on major original equipment manufacturer ("OEM") customers; commodities availability and pricing; supply disruptions; fluctuations in interest rates and foreign currency exchange rates; availability of credit; the Company's dependence on key management; the Company's dependence on information systems; the uncertainty of the global economic environment; the outcome of existing or any future legal proceedings, including litigation with respect to various claims; future changes in laws and regulations, including, by way of example, tariffs, in the countries in which the Company operates; impacts from any potential future acquisition or divestiture transaction; and the other risks  described in Part I, Item 1A, "Risk Factors," in the Company's Annual Report on Form 10-K for the year ended December 31, 2020. The Company does not undertake any obligation to update any forward-looking statements, except as required by law.

 

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SOURCE BorgWarner

FAQ

When will BorgWarner redeem its 1.80% Senior Notes due 2022?

BorgWarner will redeem its 1.80% Senior Notes due 2022 on June 18, 2021.

What is the value of the Senior Notes being redeemed by BorgWarner?

The value of the Senior Notes being redeemed is €500 million.

What are the terms of the redemption for BorgWarner's 2022 Notes?

The redemption includes 100% of the principal amount plus any unpaid interest and the Make-Whole Amount.

Who is the paying agent for BorgWarner's Senior Notes redemption?

DB Services Americas, Inc. is acting as the paying agent for the redemption.