Adient offers $500 million five-year secured notes in Monday drive-by

By Paul A. Harris

Portland, Ore., April 20 – Adient plans to price a $500 million offering of five-year senior secured notes (expected Ba3/confirmed B+) in a Monday drive-by, according to market sources.

Initial talk has the deal coming to yield in the high 9% area, a trader said.

The notes come with a springing maturity that moves forward to May 15, 2024 if Adient's senior unsecured notes due 2024 have not been refinanced by May 15, 2024.

Citigroup Global Markets Inc. is the lead bookrunner. BofA Securities Inc., Credit Agricole CIB and J.P. Morgan Securities LLC are the joint bookrunners.

Barclays, Deutsche Bank Securities Inc., ING Financial Markets LLC, Loop Capital Markets LLC, MUFG, U.S. Bancorp Investments Inc. and Evercore are the co-managers.

The notes become callable after two years at par plus 50% of the coupon.

Prior to 120 days after the issue date the issuer may redeem up to 35% of the notes at par plus half the coupon with the proceeds of any loan received pursuant to the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

The notes also feature a two-year 35% equity clawback at par plus the coupon and a 101% poison put.

The issuing entity will be Adient US LLC.

The Plymouth, Mich.-based manufacturer of automotive seating plans to use the proceeds for working capital and general corporate purposes.

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