TransDigm expects to sell $550 million tap of 6 3/8% secured notes due 2029 in Thursday drive-by

By Paul A. Harris

Portland, Ore., March 14 – TransDigm Inc. expects to price a $550 million add-on to its 6 3/8% senior secured notes due March 1, 2029 (Ba3/B+) in a Thursday drive-by, according to market sources.

Initial price talk is 99 to 99.5, a bond trader said.

The notes become subject to an initial call on March 1, 2026 at 103.188. They feature a 40% equity clawback at par plus the full coupon during the non-call period.

Morgan Stanley & Co. LLC, Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, BofA Securities Inc., BMO Capital Markets Corp., Capital One Securities Inc., KKR Capital Markets LLC, HSBC Securities (USA) Inc., Wells Fargo Securities LLC, PNC Capital Markets LLC and RBC Capital Markets LLC are the joint bookrunners.

The Cleveland-based supplier of highly engineered aircraft components plans to use the proceeds plus cash on hand to redeem all of its outstanding 7½% senior subordinated notes due 2027.

The original $2.2 billion issue priced on Feb. 12, 2024.

The Rule 144A add-on notes are set to become immediately fungible with the original notes. The Regulation S add-on notes become fungible with the original notes following a 40-day cooling period.

With the additional notes the total size of the issue will be $2.75 billion.

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