8-KOther EventsExhibits & Filings

Dell Technologies Inc. 8-K Report, Corporate Update (Mar 6, 2024)

Filed March 6, 2024For Securities:DELL

Summary

Dell Technologies Inc. (DELL) has announced its entry into a material definitive agreement to issue and sell $1 billion of 5.400% Senior Notes due 2034. This offering is being conducted through an underwriting agreement with a syndicate of major financial institutions, with the notes expected to be sold at a slight discount to par value. The company intends to use the net proceeds from this issuance to redeem a portion of its higher-yielding 6.020% Senior Notes due 2026. This debt issuance represents a proactive move by Dell to optimize its capital structure by refinancing existing debt with lower-cost financing. The redemption of the 2026 notes, carrying a higher interest rate, is expected to lead to a reduction in Dell's future interest expenses. Investors should view this as a positive step towards improving financial efficiency and potentially enhancing profitability.

Key Highlights

  • 1Dell Technologies Inc. entered into an underwriting agreement to issue $1 billion in 5.400% Senior Notes due 2034.
  • 2The offering is being made through a syndicate of prominent underwriters including Barclays Capital Inc., BofA Securities, Inc., Citigroup Global Markets Inc., and others.
  • 3The notes will be sold at 99.802% of their aggregate principal amount.
  • 4Proceeds from the note issuance will be used to redeem a portion of Dell's 6.020% Senior Notes due 2026.
  • 5The debt offering is guaranteed by Dell Technologies Inc., Denali Intermediate, Inc., and Dell Inc.
  • 6The closing of the offering is anticipated on March 18, 2024, subject to customary closing conditions.
  • 7The issuance is registered with the SEC under a Form S-3 registration statement.

Frequently Asked Questions

The primary purpose of issuing the new 5.400% Senior Notes due 2034 is to generate funds that will be used to redeem a portion of Dell's existing 6.020% Senior Notes due 2026. This is a debt refinancing strategy aimed at lowering Dell's overall interest expense by replacing higher-cost debt with lower-cost debt.

Dell is raising $1 billion in aggregate principal amount through the issuance of these notes. The notes will carry a coupon rate of 5.400% and mature in 2034. They are being offered at a public offering price of 99.802% of their aggregate principal amount.

The new 5.400% Senior Notes due 2034 will be guaranteed on a joint and several unsecured basis by Dell Technologies Inc. (the parent company), Denali Intermediate, Inc., and Dell Inc.

The closing of the offering of the new Senior Notes is expected to occur on March 18, 2024, provided that all customary closing conditions are met.