Summary
Emerson Electric Co. (EMR) announced on December 21, 2021, the completion of a substantial public offering of debt securities, raising approximately $2.98 billion in net proceeds. This offering comprises three tranches of senior unsecured notes: $1 billion of 2.000% Notes due 2028, $1 billion of 2.200% Notes due 2031, and $1 billion of 2.800% Notes due 2051. These notes are issued under an existing indenture and rank equally with other unsecured, unsubordinated debt. The primary purpose for these proceeds is to fund a significant portion of Emerson's approximately $6.0 billion contribution to the existing stockholders of Aspen Technology, Inc. (AspenTech) as part of the previously announced merger transaction. This move signals Emerson's commitment to the acquisition and its intention to finance a major part of the deal through debt issuance, impacting the company's capital structure and leverage.
Key Highlights
- 1Completed a $3 billion aggregate principal amount offering of senior unsecured notes across three maturities: 2028, 2031, and 2051.
- 2Successfully raised approximately $2.98 billion in net proceeds from the debt offering.
- 3The notes bear fixed interest rates: 2.000% for 2028 notes, 2.200% for 2031 notes, and 2.800% for 2051 notes.
- 4Proceeds are primarily earmarked for a portion of the $6.0 billion contribution to Aspen Technology, Inc. stockholders related to the merger agreement.
- 5The debt is senior unsecured, ranking pari passu with existing and future unsecured and unsubordinated debt.
- 6Includes a conditional redemption provision requiring a 101% redemption of outstanding notes if the AspenTech transaction is not completed by October 10, 2022, or is terminated.