SEE Announces Cash Tender Offer For Any and All 5.500% Senior Notes Due 2025
Sealed Air (SEE) has announced a cash tender offer for its 5.500% Senior Notes due 2025. The offer targets any and all outstanding notes of this issue. The principal amount outstanding is $400 million. The offer will expire on June 24, 2024, at 5:00 p.m. (NYC time). Notes tendered may be withdrawn before the expiration date. The total consideration for each $1,000 principal amount will be determined by adding a fixed spread of 50 basis points to the yield to maturity based on the bid-side price of the reference security. In addition to the total consideration, accrued and unpaid interest up to, but not including, the settlement date (expected June 28, 2024) will be paid. The offer is subject to SEE's completion of a new debt securities offering. J.P. Morgan Securities is the exclusive Dealer Manager for the tender offer.
- Sealed Air aims to repurchase its 5.500% Senior Notes, potentially reducing future interest expenses.
- Total $400 million principal amount is targeted, which shows a commitment to active debt management.
- J.P. Morgan Securities is acting as exclusive Dealer Manager, providing credibility to the tender offer process.
- The tender offer is contingent on SEE completing a new debt securities offering, introducing uncertainty.
- Potential risk of not achieving full tender of the $400 million outstanding notes.
- Tendering could dilute existing shareholders if the new debt offering's terms are unfavorable.
Insights
The cash tender offer by Sealed Air Corporation (SEE) to purchase its 5.500% Senior Notes due 2025 is a significant move. It helps the company manage its debt strategically by potentially reducing the outstanding debt on its balance sheet. The offer gives noteholders the opportunity to liquidate their holdings before the scheduled maturity in 2025, which can be attractive given the fixed spread of 50 basis points over the U.S. Treasury Reference Security.
This tender offer may also signal SEE's confidence in its financial health and liquidity, as it likely aims to refinance these notes with new debt securities under more favorable terms. Refinancing at a lower interest rate could reduce interest expenses, improving net income in the long term. However, the success of the tender offer and subsequent debt refinancing will hinge on market conditions and investor appetite for new debt securities.
For retail investors, this move indicates proactive debt management, which could favorably affect SEE's financial stability and creditworthiness. Nonetheless, it's worth noting that SEE retains the flexibility to amend or terminate the tender offer based on prevailing conditions.
From a market perspective, this tender offer can be interpreted as a measure to enhance SEE's financial structure. By potentially lowering the overall debt load and substituting existing debt with new issuance, SEE may improve its leverage ratios, which could be favorable in the eyes of credit rating agencies. Improved ratings can lead to lower borrowing costs in the future, thus positively impacting the company's long-term financial health.
Additionally, SEE's engagement of J.P. Morgan Securities LLC as the Dealer Manager and Global Bondholder Services Corporation as the Depositary and Information Agent reflects a structured and professional approach to this tender offer. The involvement of these established entities adds credibility to the process, potentially increasing confidence among current noteholders to tender their notes.
Investors should be aware that the tender offer's success could lead to short-term fluctuations in SEE's stock price, driven by market perception of the company's debt management practices. While this move is seen as positive in the long term, the immediate reaction will depend on the broader market sentiment and the terms of the new debt offering.
The legal intricacies of SEE's tender offer are noteworthy. The detailed terms and conditions set forth in the Offer to Purchase and Notice of Guaranteed Delivery imply stringent compliance with regulatory standards. This is critical for maintaining investor trust and avoiding legal pitfalls. By reserving the right to amend or terminate the tender offer, SEE ensures it remains compliant and adaptable to any unforeseen legal or market developments.
An important aspect for investors to consider is SEE's potential move to redeem, defease, or satisfy any remaining notes post the tender offer. These options provide flexibility in managing residual debt, which can be advantageous if market conditions shift unfavorably. The involvement of experienced entities like J.P. Morgan and Global Bondholder Services Corporation further underscores a meticulous approach to this tender offer, minimizing the risk of legal disputes or non-compliance issues.
Retail investors should recognize that the legal framework outlined in the Offer Documents aims to protect their interests while facilitating SEE's strategic financial maneuvers. Understanding these aspects can help investors make more informed decisions regarding the tender offer.
The following table summarizes the material pricing terms of the Tender Offer, which is being made upon, and is subject to, the terms and conditions set forth in the Offer Documents.
Title of Security | CUSIPs / ISINs | Principal | Reference | Bloomberg | Fixed |
| 81211KAX8/US1211KAX81 (Rule 144A), U81193 AP6 / USU81193AP68 |
| PX4 | 50 bps |
The Tender Offer will expire at 5:00 p.m.,
The consideration (the "Total Consideration") offered for each
Holders must validly tender (and not validly withdraw) their Notes at or prior to the Expiration Date, or deliver a properly completed and duly executed Notice of Guaranteed Delivery for their Notes at or prior to the Expiration Date, and tender their Notes at or prior to the Guaranteed Delivery Date (as defined in the Offer to Purchase), in accordance with the instructions set forth in the Offer to Purchase, in order to be eligible to receive the Total Consideration. In addition, holders whose Notes are accepted for purchase in the Tender Offer will receive accrued and unpaid interest from the last interest payment date to, but not including, the Settlement Date.
SEE's obligation to accept for purchase and to pay for the Notes validly tendered and not validly withdrawn pursuant to the Tender Offer is subject to the satisfaction or waiver of certain conditions, which are more fully described in the Offer to Purchase, including, among others, SEE and Sealed Air Corporation (US) completing the offering and sale of new debt securities (the "New Notes Offering") on terms acceptable to SEE.
The Tender Offer does not constitute an offer to sell or a solicitation of an offer to buy any securities or other financial instruments that may be issued or otherwise incurred in connection with the New Notes Offering. SEE reserves the right, subject to applicable law, in its sole discretion, to: (i) waive any and all conditions to the Tender Offer at any time and from time to time; (ii) extend or terminate the Tender Offer; or (iii) otherwise amend the Tender Offer in any respect. SEE is not soliciting consents from holders of securities in connection with the Tender Offer.
Nothing contained in the Offer to Purchase will prevent SEE from exercising its rights to redeem, defease or satisfy or otherwise discharge its obligations with respect to all or a portion of Notes by depositing cash or securities with the trustee in accordance with the indenture governing the Notes.
SEE has retained J.P. Morgan Securities LLC to act as exclusive Dealer Manager. Global Bondholder Services Corporation has been retained to serve as both the depositary and the information agent (the "Depositary and Information Agent") for the Tender Offer. For additional information regarding the terms of the Tender Offer, please contact: J.P. Morgan Securities LLC at (866) 834-4666 (toll free) or (212) 834-3554 (collect). Requests for copies of the Offer to Purchase and other related materials should be directed to Global Bondholder Services Corporation at contact@gbsc-usa.com (email), 1-855-654-2014 (
Copies of the Offer to Purchase and Notice of Guaranteed Delivery are available at the following web address: https://www.gbsc-usa.com/sealedair/.
This press release is for informational purposes only and is not an offer to purchase or a solicitation of an offer to sell with respect to any Notes nor is this announcement an offer to sell or a solicitation of an offer to purchase new debt securities. The Tender Offer is being made solely pursuant to the Offer Documents, which set forth the complete terms and conditions of the Tender Offer. The Tender Offer is not being made to, nor will SEE accept tenders of Notes from, holders in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction. This press release does not constitute a notice of satisfaction and discharge with respect to the Notes.
None of SEE, its affiliates, their respective board of directors, the Dealer Manager, the trustee of the Notes or the Depositary and Information Agent makes any recommendation to any holder of Notes in connection with the Tender Offer. Holders must make their own decisions as to whether to tender their Notes and, if so, the principal amount of Notes to tender.
About SEE
Sealed Air Corporation (NYSE: SEE), is a leading global provider of packaging solutions that integrate sustainable, high-performance materials, automation, equipment and services. SEE designs, manufactures and delivers packaging solutions that preserve food, protect goods and automate packaging processes. We deliver our packaging solutions to an array of end markets including fresh proteins, foods, fluids and liquids, medical and life science, e-commerce retail, logistics and omnichannel fulfillment operations, and industrials. Our globally recognized solution brands include CRYOVAC® brand food packaging, LIQUIBOX® brand liquids systems, SEALED AIR® brand protective packaging, AUTOBAG® brand automated packaging systems, and BUBBLE WRAP® brand packaging. In 2023, SEE generated
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Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 concerning our business, consolidated financial condition, results of operations and cash flows. Forward-looking statements are subject to risks and uncertainties, many of which are outside our control, which could cause actual results to differ materially from these statements. Therefore, you should not rely on any of these forward-looking statements. Forward-looking statements can be identified by such words as "anticipate," "believe," "plan," "assume," "could," "should," "estimate," "expect," "intend," "potential," "seek," "predict," "may," "will" and similar references to future periods. All statements other than statements of historical facts included in this press release regarding our strategies, prospects, financial condition, operations, costs, plans and objectives are forward-looking statements. Examples of forward-looking statements include, among others, statements we make regarding expected future operating results, expectations regarding the results of restructuring and other programs, expectations regarding future impacts of acquisitions, anticipated levels of capital expenditures and expectations of the effect on our financial condition of claims, litigation, environmental costs, contingent liabilities and governmental and regulatory investigations and proceedings.
The following are important factors that we believe could cause actual results to differ materially from those in our forward-looking statements: global economic and political conditions, including recessionary and inflationary pressures, currency translation and devaluation effects, changes in raw material pricing and availability, competitive conditions, the success of new product offerings, failure to realize synergies and other financial benefits from acquisitions within the expected time frames, greater than expected costs or difficulties related to acquisition integrations, consumer preferences, the effects of animal and food-related health issues, the effects of epidemics or pandemics, negative impacts related to the ongoing conflict between
Company Contacts
Investor Relations
Brian Sullivan
Brian.c.sullivan@sealedair.com
704.503.8841
Louise Lagache
Louise.lagache@sealedair.com
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FAQ
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