8-KOther EventsExhibits & Filings

Amcor plc 8-K Report, Corporate Update (Jun 19, 2020)

Filed June 19, 2020For Securities:AMCRAMCCF

Summary

Amcor plc (AMCR) filed an 8-K on June 19, 2020, primarily disclosing the details of a new debt offering. Bemis Company, Inc., a subsidiary of Amcor, issued $500 million in aggregate principal amount of 2.630% Senior Notes due 2030. These notes are fully and unconditionally guaranteed by Amcor plc and other Amcor subsidiaries, providing investors with additional security. The net proceeds from this issuance are expected to be approximately $496.2 million after deducting underwriting discounts and expenses. The funds raised are designated for general corporate purposes and to partially repay commercial paper and bank drawdowns. This move suggests Amcor is managing its capital structure, potentially refinancing short-term debt with longer-term, fixed-rate obligations. Investors should note the attractive coupon rate and the strong guarantee from the parent company, which enhances the credit profile of these notes.

Key Highlights

  • 1Bemis Company, Inc. issued $500 million in 2.630% Senior Notes due 2030.
  • 2Amcor plc and other subsidiaries provided full and unconditional guarantees for the notes.
  • 3Net proceeds from the offering are approximately $496.2 million.
  • 4Proceeds will be used for general corporate purposes.
  • 5Funds will also be used for the partial repayment of commercial paper and bank drawdowns.
  • 6The offering was conducted under a Registration Statement on Form S-3.
  • 7Deutsche Bank Trust Company Americas is the trustee for the Indenture governing the notes.

Frequently Asked Questions

Amcor plc, through its subsidiary Bemis Company, Inc., issued these senior notes primarily to raise capital for general corporate purposes and to reduce its outstanding commercial paper and bank borrowings. This indicates a strategic move to manage its debt profile, potentially refinancing short-term liabilities with long-term debt.

The full and unconditional guarantees from Amcor plc and other subsidiaries significantly strengthen the credit quality of the notes. This means that Amcor plc itself is directly obligated to repay the notes if Bemis Company, Inc. were unable to do so, providing investors with greater security and confidence in the investment.

The net proceeds, estimated at $496.2 million, will be allocated to Amcor's general corporate purposes, which can include funding ongoing operations, investments, or acquisitions. Additionally, a portion will be used to repay outstanding commercial paper and bank drawdowns, thereby deleveraging the company's short-term debt obligations.

The senior notes bear a fixed interest rate of 2.630% and mature on June 19, 2030. This provides investors with a predictable stream of income over a significant period.