8-KOther EventsExhibits & Filings

Archer-Daniels-Midland Co 8-K Report, Corporate Update (Aug 20, 2020)

Filed August 20, 2020For Securities:ADM

Summary

Archer-Daniels-Midland Company (ADM) announced on August 20, 2020, the pricing of two significant transactions involving its stake in Wilmar International Limited. Firstly, ADM's subsidiaries sold 170.5 million ordinary shares of Wilmar International (the "Wilmar Shares") through a secondary block trade at SGD 4.40 per share. Secondly, ADM Ag priced an offering of US$300 million in Zero Coupon Exchangeable Bonds due 2023, which are exchangeable for Wilmar Shares. These transactions are expected to generate capital for ADM while strategically managing its investment in Wilmar. The company anticipates retaining at least a 20 percent equity interest in Wilmar International post-completion of both the block trade and the bond offering, indicating a continued strategic interest in the company. Investors should note the details regarding the offering of the bonds outside the United States and the methods of sale for the Wilmar Shares.

Key Highlights

  • 1ADM sold 170.5 million ordinary shares of Wilmar International Limited in a secondary block trade.
  • 2The Wilmar Shares were sold at a price of SGD 4.40 per share (approximately US$3.23).
  • 3ADM Ag priced an offering of US$300,000,000 of Zero Coupon Exchangeable Bonds due 2023.
  • 4The exchangeable bonds will mature on August 26, 2023, and are offered outside the United States.
  • 5Bonds will be exchangeable for Wilmar International Limited shares at a specified ratio.
  • 6ADM expects to retain at least a 20% equity interest in Wilmar International after these transactions.
  • 7Settlement for the block trade is expected on August 24, 2020, and for the bonds on August 26, 2020.

Frequently Asked Questions

These transactions are designed to optimize ADM's capital structure and strategically manage its investment in Wilmar International. The sale of shares and the issuance of exchangeable bonds are expected to generate capital for ADM while allowing it to retain a significant equity stake in Wilmar.

No, ADM expects to retain at least a 20 percent equity interest in Wilmar International even after the completion of the block trade and the potential exchange of the bonds. This indicates a continued strategic interest and substantial ownership.

The Zero Coupon Exchangeable Bonds due 2023 are being offered outside the United States to non-U.S. persons in reliance on Regulation S. The sale of Wilmar Shares is also conducted in offshore transactions under Regulation S and to qualified institutional buyers in the U.S. under Rule 144A.

The bonds have a principal amount of US$300 million and were issued at 104.0% of their principal amount. They do not bear interest but mature on August 26, 2023. The key feature is their exchangeability into Wilmar Shares, providing ADM with a mechanism to potentially reduce its stake further or manage its investment over time.