OpenText Announces Proposed Offerings of Senior Unsecured Fixed Rate Notes to Redeem Outstanding 2026 Notes
Open Text Corporation (NASDAQ: OTEX) has announced proposed offerings of $1.0 billion in senior unsecured fixed rate notes. The company intends to use a substantial portion of the proceeds to redeem $850 million of its outstanding 5.875% notes due 2026, along with a $25 million make-whole premium. The offerings include notes due in 2029 and 2031, with terms dependent on market conditions. The notes will not be registered under the Securities Act, limiting their sale in the U.S. These offerings aim to bolster OpenText's financial flexibility and support future acquisitions.
- Proposed offerings of $1.0 billion in senior unsecured fixed rate notes.
- Intends to redeem $850 million of 5.875% notes due 2026, reducing future interest expenses.
- Plans to use proceeds for general corporate purposes and potential acquisitions.
- Redemption may result in a $25 million make-whole premium impacting cash flow.
- Notes not registered under Securities Act limits potential investor base.
WATERLOO, ON, Nov. 9, 2021 /PRNewswire/ -- Open Text Corporation (NASDAQ: OTEX) (TSX: OTEX) ("OpenText" or the "Company") announced today proposed offerings of
OpenText intends to use the substantial portion of the net proceeds from the offerings to (i) redeem in full the outstanding
The proposed offerings consist of OpenText's senior unsecured fixed rate notes due 2029 (the "OTC notes"), guaranteed initially on a senior unsecured basis by OpenText's existing wholly-owned subsidiaries that borrow or guarantee OpenText's obligations under its existing senior credit facilities, and OTHI's senior unsecured fixed rate notes due 2031 (the "OTHI notes" and collectively with the OTC notes, the "notes"), guaranteed on a senior unsecured basis by OpenText and initially guaranteed by OpenText's existing wholly-owned subsidiaries (other than OTHI) that borrow or guarantee OpenText's obligations under its existing senior credit facilities. The precise timing, size and terms of the offerings (including the size of each offering) are subject to market conditions and other factors.
The notes and related guarantees will not be registered under the Securities Act of 1933, as amended (the "Securities Act"). The notes and related guarantees may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons, except to persons reasonably believed to be qualified institutional buyers in reliance on the exemption from registration provided by Rule 144A under the Securities Act and to certain persons in offshore transactions in reliance on Regulation S under the Securities Act. The notes and related guarantees will be offered in Canada under available prospectus exemptions.
This press release does not constitute an offer to sell or the solicitation of an offer to buy the notes and related guarantees. Any offers of the notes and related guarantees will be made only by means of a related private offering memorandum with respect to such notes and related guarantees.
This press release shall not constitute a notice of redemption under the indenture governing the 2026 Notes, dated as of May 31, 2016. Any such notice, if made, will only be made in accordance with the provisions of the indenture governing the 2026 Notes. There can be no assurances as to whether OpenText will actually implement any such redemption.
About OpenText
OpenText, The Information Company™, enables organizations to gain insight through market leading information management solutions, powered by OpenText Cloud Editions.
Certain statements in this press release may contain words considered forward-looking statements or information under applicable securities laws. These statements are based on OpenText's current expectations, estimates, forecasts and projections about the proposed offerings and the proposed redemption, and the operating environment, economies and markets in which the Company operates. These statements are subject to important assumptions, risks and uncertainties that are difficult to predict, and the actual outcome may be materially different. OpenText's assumptions, although considered reasonable by the Company at the date of this press release, may prove to be inaccurate and consequently its actual results could differ materially from the expectations set out herein. For additional information with respect to risks and other factors which could occur, see OpenText's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other securities filings with the Securities and Exchange Commission and other securities regulators. Unless otherwise required by applicable securities laws, OpenText disclaims any intention or obligations to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
OTEX-F
Copyright ©2021 Open Text. OpenText is a trademark or registered trademark of Open Text. The list of trademarks is not exhaustive of other trademarks. Registered trademarks, product names, company names, brands and service names mentioned herein are property of Open Text. All rights reserved.
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SOURCE Open Text Corporation
FAQ
What is the purpose of OpenText's recent $1.0 billion note offering?
When are the senior unsecured fixed rate notes due?
How much is OpenText redeeming from its 2026 notes?
What is the make-whole premium associated with the redemption?
Is the newly proposed note offering registered under the Securities Act?
