8-KRegulation FDOther EventsExhibits & Filings

DOW INC. 8-K Report, Regulation FD Disclosure (Aug 26, 2020)

Filed August 26, 2020For Securities:DOW

Summary

Dow Inc. (DOW) announced on August 26, 2020, the successful closing of a significant notes offering, raising $2.0 billion in aggregate principal amount. This offering comprises $850 million in 2.100% Notes due 2030 and $1.15 billion in 3.600% Notes due 2050. The primary purpose of this capital raise is to strategically manage the company's existing debt obligations. Investors should note that the proceeds from this offering are earmarked for specific debt redemptions and repurchases. This includes repaying up to $1.25 billion under a term loan facility of a subsidiary, Dow Silicones Corporation, and financing cash tender offers for certain debt securities of Dow Inc. and its subsidiary Union Carbide Corporation, up to an aggregate purchase price of $550 million. Any remaining funds will be applied to other outstanding indebtedness. This proactive debt management aims to optimize the company's capital structure and potentially reduce future interest expenses.

Key Highlights

  • 1Dow Inc. completed a $2.0 billion notes offering on August 26, 2020.
  • 2The offering consists of $850 million in 2.100% Notes due 2030 and $1.15 billion in 3.600% Notes due 2050.
  • 3Proceeds will be used to repay up to $1.25 billion of a subsidiary's term loan (Dow Silicones Corporation).
  • 4Funds will also finance cash tender offers for up to $550 million of debt securities from Dow Inc. and Union Carbide Corporation.
  • 5Any remaining proceeds will be used for other indebtedness repayment.
  • 6The notes were issued under the company's existing registration statement on Form S-3.
  • 7This action represents a strategic effort to manage and potentially optimize Dow's existing debt profile.

Frequently Asked Questions

The primary reason is to proactively manage and refinance existing debt. The proceeds are specifically allocated to repay a significant portion of a subsidiary's term loan and to fund tender offers for other company debt securities.

The proceeds are intended to repay up to $1.25 billion of the principal balance outstanding under the term loan facility of Dow Silicones Corporation. Additionally, up to $550 million will be used for cash tender offers to purchase certain debt securities of Dow Inc. and Union Carbide Corporation.

Dow Inc. issued $850 million of 2.100% Notes due 2030 and $1.15 billion of 3.600% Notes due 2050.

This offering is primarily a refinancing activity rather than an increase in total debt. Dow is exchanging existing debt obligations for new notes, with the intention of managing its debt structure, maturity profile, and potentially reducing future interest costs.