Summary
On September 19, 2013, Cummins Inc. (CMI) entered into an Underwriting Agreement to issue $1 billion in aggregate principal amount of senior notes. The offering consisted of $500 million of 3.650% Senior Notes due 2023 and $500 million of 4.875% Senior Notes due 2043. The company completed the sale of these notes on September 24, 2013. The net proceeds from this issuance are anticipated to be used for the planned acquisitions of equity in its partially-owned U.S. and Canadian distributors, as well as for general corporate purposes. This strategic move indicates Cummins' intent to consolidate ownership and potentially enhance operational control and synergies within its distribution network.
Key Highlights
- 1Completed a $1 billion public offering of senior notes on September 24, 2013.
- 2Issued $500 million in 3.650% Senior Notes due 2023.
- 3Issued $500 million in 4.875% Senior Notes due 2043.
- 4The offering was conducted under an Underwriting Agreement with several underwriters, including Goldman, Sachs & Co., J.P. Morgan Securities LLC, and Merrill Lynch, Pierce, Fenner & Smith Incorporated.
- 5Proceeds are earmarked for acquiring full ownership of most U.S. and Canadian distributors, as well as for general corporate purposes.
- 6The notes are governed by an Indenture dated September 16, 2013, with U.S. Bank National Association as trustee.
- 7The Indentures include provisions for redemption, a change of control repurchase offer at 101% of principal, and standard events of default.