WMG Acquisition Corp. Announces Pricing of $550 Million Senior Secured Notes Offering

Rhea-AI Summary

Warner Music Group Corp. (WMG) announced a private offering of $550 million in 3.000% Senior Secured Notes due 2031, set to close on August 12, 2020. The offering is exempt from the registration requirements of the Securities Act and targets qualified institutional buyers. Proceeds will partially repay a senior term loan, cover related fees, and support general corporate purposes. The notes are not registered under the Securities Act and cannot be sold in the U.S. without registration or exemption. This strategic move aims to optimize WMG's financial position.

Positive

• Raising $550 million to strengthen liquidity
• Targeted repayment of senior term loan to improve financial stability

Negative

• Increased debt obligations with the issuance of new notes
• Potential cash flow strain due to interest payments on the new debt

NEW YORK, Aug. 06, 2020 (GLOBE NEWSWIRE) -- Warner Music Group Corp. (“Warner Music Group” or “WMG”) today announced that through its wholly owned subsidiary, WMG Acquisition Corp. (the “Company”), it has priced a private offering (the “Offering”) of $550 million aggregate principal amount of 3.000% Senior Secured Notes due 2031 (the “Notes”). The Offering is expected to close on August 12, 2020, subject to customary closing conditions.

The Notes have been offered and sold in a private offering exempt from the registration requirements of the United States Securities Act of 1933, as amended (the “Securities Act”).  The Notes have been offered and sold only to qualified institutional buyers pursuant to Rule 144A and to certain persons outside the United States pursuant to Regulation S, each under the Securities Act. The Company intends to use the proceeds of the Offering to repay a portion of its senior term loan facility, to pay certain other related fees and expenses and to use any remaining net proceeds for working capital and other general corporate purposes.

The Notes have not been registered under the Securities Act and may not be offered or sold within the United States absent registration or an applicable exemption from the registration requirements.

This press release is for informational purposes only and is not an offer to sell or purchase nor the solicitation of an offer to sell or purchase securities and shall not constitute an offer, solicitation or sale in any state or jurisdiction in which, or to any person to whom such an offer, solicitation or sale would be unlawful.

About Warner Music Group

With a legacy extending back over 200 years, Warner Music Group (WMG) today brings together artists, songwriters and entrepreneurs that are moving entertainment culture across the globe. Operating in more than 70 countries through a network of affiliates and licensees, WMG’s Recorded Music division includes renowned labels such as Asylum, Atlantic, Big Beat, Canvasback, Elektra, Erato, First Night, Fueled by Ramen, Nonesuch, Parlophone, Reprise, Rhino, Roadrunner, Sire, Spinnin’, Warner Records, Warner Classics and Warner Music Nashville.  WMG’s music publishing arm, Warner Chappell Music, has a catalog of more than 1.4 million musical compositions spanning every musical genre, from the standards of the Great American Songbook to the biggest hits of the 21st century. Warner Music Group is also home to ADA, the independent artist and label services company, as well as consumer brands such as Songkick the live music app, EMP the merchandise e-tailer, and UPROXX the youth culture destination.

This communication includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The forward-looking statements contained herein involve risks and uncertainties that could cause actual results to differ materially from those referred to in the forward-looking statements. More information about Warner Music Group and other risks related to Warner Music Group are detailed in Warner Music Group’s most recent annual report on Form 10-K and its quarterly reports on Form 10-Q and current reports on Form 8-K as filed with the Securities and Exchange Commission. Warner Music Group does not undertake an obligation to update forward-looking statements.

Warner Music Group maintains an Internet site at www.wmg.com.  Warner Music Group uses its website as a channel of distribution of material Company information.  Financial and other material information regarding Warner Music Group is routinely posted on and accessible at http://investors.wmg.com.  In addition, you may automatically receive email alerts and other information about Warner Music Group by enrolling your email address through the “email alerts” section at http://investors.wmg.com.  Warner Music Group’s website and the information posted on it or connected to it shall not be deemed to be incorporated by reference into this communication.

Additional factors that may affect future results and conditions are described in Warner Music Group’s filings with the SEC, which are available at the SEC’s web site at www.sec.gov or at Warner Music Group’s website at www.wmg.com.

SOURCE: WMG

Media Contact:
James Steven
(212) 275-2213
James.Steven@wmg.com

Summer Wilkie
(212) 275-3921
Summer.Wilkie@wmg.com

Sard Verbinnen & Co
WMG-SVC@SARDVERB.com

FAQ

What is the value of the private offering by WMG?

Warner Music Group has announced a private offering valued at $550 million.

What is the interest rate on the Senior Secured Notes issued by WMG?

The interest rate on the Senior Secured Notes is 3.000%.

When is the offering of the Senior Secured Notes expected to close?

The offering is expected to close on August 12, 2020.

What will WMG do with the proceeds from the bond offering?

WMG plans to use the proceeds to repay a portion of its senior term loan and for general corporate purposes.

Who can purchase the Senior Secured Notes from WMG?

The Notes are offered only to qualified institutional buyers under Rule 144A and certain persons outside the U.S.