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Schaeffler plans €2 billion bond offer under €3.5 billion refinancing
By Marisa Wong
Madison, Wis., May 6 - Schaeffler said it is planning to issue about €2 billion of additional bonds as part of a comprehensive refinancing transaction.
The new bonds are to be denominated in euros and dollars.
Schaeffler intends to place senior secured benchmark bonds (Ba2) with maturities of five, seven and eight years with institutional investors.
Schaeffler also plans to place a debut euro-denominated bond tranche (B1) with a five-year maturity.
The issue size and final terms will be determined over the next days, the company said.
This proposed offering is part of a comprehensive capital markets transaction with a total refinancing volume of roughly €3.5 billion.
The company also intends to replace €1.6 billion of institutional loan tranches with new loan tranches at improved terms.
Proceeds will be used to redeem existing notes, such as the 2017 euro-denominated retail bond and the 2019 euro- and dollar-denominated bonds, as well as to refinance the existing institutional term loan and a part of bank loans.
The goal of the refinancing transaction is to further reduce the interest costs, extend the debt maturity profile and improve the terms and conditions of bonds and loans for Schaeffler Group.
The company expects to complete the bond issuance within a short period and to complete the overall refinancing transaction by May 14.
Schaeffler is a Herzogenaurach, Germany-based manufacturer of bearings for autos & industrial OEMs.
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