Cimpress Prices Offering of $525 Million of Senior Notes Due 2032

Rhea-AI Summary

Cimpress plc (Nasdaq: CMPR) has priced a private offering of $525 million in 7.375% senior notes due 2032. The notes, priced at 100% of principal, will pay interest semi-annually. The offering is expected to close on September 26, 2024, subject to customary conditions. Concurrently, Cimpress plans to amend its existing credit agreement to extend the maturity of its revolving credit facility and adjust the applicable interest rate.

The company intends to use the net proceeds, along with cash on hand, to redeem all existing 7.0% Senior Notes due 2026 and cover related fees and expenses. The notes are not registered under the Securities Act and will be offered only to qualified institutional buyers in the U.S. and non-U.S. persons in offshore transactions.

Positive

• Successful pricing of $525 million senior notes offering
• Extension of revolving credit facility maturity through credit agreement amendment
• Redemption of existing 7.0% Senior Notes due 2026, potentially improving debt structure

Negative

• Increase in interest rate from 7.0% to 7.375% on new senior notes
• Potential increase in long-term debt obligations

Insights

Financial Analyst

Cimpress's $525 million senior notes offering at 7.375% interest rate signals a strategic move to refinance existing debt. This new issuance, priced at par, aims to redeem the 7.0% notes due in 2026, potentially lowering the company's overall interest expenses. The concurrent amendment of the credit agreement, extending the revolving credit facility's maturity, suggests improved financial flexibility.

However, investors should note that while the interest rate environment has changed, Cimpress is still opting for relatively high-yield debt. This could indicate ongoing challenges in securing more favorable terms, possibly due to the company's risk profile or broader market conditions. The impact on the company's balance sheet and future cash flows will be important to monitor.

Legal Expert

The private offering structure of these notes under Rule 144A and Regulation S exemptions is a common approach for expedited capital raising without the extensive SEC registration process. This method allows Cimpress to access capital markets efficiently, but limits the initial investor base to qualified institutional buyers and non-U.S. persons.

The careful language around the non-contingent nature of the offering and credit agreement amendment is noteworthy. It provides Cimpress with flexibility to proceed with either transaction independently, potentially safeguarding against unforeseen complications. Investors should be aware that these unregistered securities have resale restrictions, which could affect liquidity in the secondary market.

DUNDALK, Ireland--(BUSINESS WIRE)-- Cimpress plc (Nasdaq: CMPR) today announced it has priced the previously announced private offering (the “Offering”) of $525.0 million in aggregate principal amount of 7.375% senior notes due 2032 (the “notes”). The notes will pay interest on a semi-annual basis. The price to investors will be 100% of the principal amount of the notes. The issuance of the notes is expected to close on September 26, 2024, subject to customary closing conditions.

Concurrently with the consummation of the Offering, we intend to amend our existing credit agreement to, among other things, extend the maturity of our revolving credit facility and amend the interest rate applicable to any loans under our revolving credit facility (the “Credit Agreement Amendment”).

We intend to use the net proceeds of this offering, together with cash on hand, to fund the redemption of all of our existing 7.0% Senior Notes due 2026 and to pay all fees and expenses related to the Offering and the Credit Agreement Amendment. The consummation of the Offering is not contingent upon the closing of the Credit Agreement Amendment and the closing of the Credit Agreement Amendment is not contingent upon the consummation of the Offering.

The notes have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act, and other applicable securities laws. Within the United States, the notes will only be offered to persons who are reasonably believed to be “qualified institutional buyers,” as defined in Rule 144A under the Securities Act. Outside the United States, the notes will only be offered to persons other than “U.S. persons,” as defined in Rule 902 under the Securities Act, in offshore transactions in reliance upon Regulation S under the Securities Act.

This press release is neither an offer to sell nor the solicitation of an offer to buy the notes or any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale is unlawful.

Some of the statements in this press release are “forward-looking” and are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These “forward-looking” statements include statements relating to, among other things, the Offering, the Credit Agreement Amendment and the intended use of proceeds of the Offering. These statements involve risks and uncertainties that may cause results to differ materially from the statements set forth in this press release, including market conditions and the risks and uncertainties referenced from time to time in the Company’s filings with the Securities and Exchange Commission. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such statements to reflect any change in its expectations with regard thereto or any changes in the events, conditions or circumstances on which any such statement is based.

About Cimpress

Cimpress plc (Nasdaq: CMPR) invests in and builds customer-focused, entrepreneurial, print mass-customization businesses for the long term. Mass customization is a competitive strategy which seeks to produce goods and services to meet individual customer needs with near mass production efficiency. Cimpress businesses include BuildASign, Drukwerkdeal, Exaprint, National Pen, Packstyle, Pixartprinting, Printi, VistaPrint, and WIRmachenDRUCK.

Cimpress and the Cimpress logo are trademarks of Cimpress plc or its subsidiaries. All other brand and product names appearing on this announcement may be trademarks or registered trademarks of their respective holders.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240912669160/en/

Investor Relations:

Meredith Burns

ir@cimpress.com

+1.781.652.6480



Media Relations:

Sara Litwiller

mediarelations@cimpress.com

Source: Cimpress plc

FAQ

What is the interest rate and maturity of Cimpress' new senior notes (CMPR)?

Cimpress (CMPR) has priced $525 million of 7.375% senior notes due 2032, with interest paid semi-annually.

When is the expected closing date for Cimpress' (CMPR) new senior notes offering?

The issuance of Cimpress' (CMPR) new senior notes is expected to close on September 26, 2024, subject to customary closing conditions.

How does Cimpress (CMPR) plan to use the proceeds from the new senior notes?

Cimpress (CMPR) intends to use the net proceeds, along with cash on hand, to redeem all existing 7.0% Senior Notes due 2026 and pay related fees and expenses.

What changes is Cimpress (CMPR) making to its existing credit agreement?

Cimpress (CMPR) plans to amend its existing credit agreement to extend the maturity of its revolving credit facility and adjust the applicable interest rate.