8-KRegulation FDOther EventsExhibits & Filings

ENTEGRIS INC 8-K Report, Regulation FD Disclosure (Jun 16, 2022)

Filed June 16, 2022For Securities:ENTG

Summary

Entegris, Inc. (ENTG) filed an 8-K on June 16, 2022, to disclose key information regarding its proposed merger with CMC Materials, Inc. and related financing activities. The company announced plans for an $895 million senior unsecured notes offering due 2030, which will be initially secured by funds held in escrow and then become unsecured obligations of Entegris upon the merger's completion. These proceeds, along with other financing sources, will be used to fund the CMC acquisition, related fees, and repay existing debt. Additionally, Entegris has secured a commitment for a $275 million senior unsecured 364-day bridge facility. This facility is intended to provide interim funding for the merger, particularly given that a significant portion of cash balances for both Entegris and CMC are held offshore. The bridge facility's availability will be reduced by proceeds from other debt or equity issuances. The filing also incorporates by reference unaudited pro forma condensed combined financial statements, offering investors a glimpse into the potential combined financial picture.

Key Highlights

  • 1Entegris announced an $895 million senior unsecured notes offering due 2030 to help finance the acquisition of CMC Materials.
  • 2A $275 million senior unsecured 364-day bridge facility has been committed to provide interim funding for the CMC merger.
  • 3Proceeds from the notes offering and bridge facility, combined with other sources, will fund the merger consideration, fees, and debt repayment.
  • 4The notes will initially be secured by escrowed funds and will become senior unsecured obligations of Entegris post-merger.
  • 5Unaudited pro forma combined financial statements for Entegris and CMC are included, illustrating the potential impact of the merger.
  • 6The filing references a separate Registration Statement (Form S-4) declared effective January 28, 2022, which contains important information for investors regarding the merger.
  • 7A cautionary note highlights numerous risks and uncertainties that could affect the successful completion of the merger and future financial performance.

Frequently Asked Questions

This 8-K filing primarily serves to disclose information related to Entegris's proposed merger with CMC Materials, Inc., specifically focusing on the financing structure for the acquisition. It details a significant notes offering, a bridge loan facility, and provides pro forma financial information to illustrate the potential combined entity.

Entegris plans to finance the acquisition through a combination of sources, including the proceeds from an $895 million senior unsecured notes offering, borrowings under a $275 million 364-day bridge facility, proceeds from a previously announced senior secured notes offering and term loan B facility, and existing cash on hand. The funds are intended to cover the cash consideration, fees, expenses, and repayment of certain existing indebtedness.

The $895 million senior unsecured notes offering is a key component of the financing for the CMC merger. The notes will initially be secured by funds held in escrow accounts. Upon completion of the merger, the issuing subsidiary will merge with Entegris, and the notes will become senior unsecured obligations of Entegris, guaranteed by certain domestic subsidiaries.

The filing highlights numerous risks that could impact the merger's completion and the combined company's performance. These include potential weakening of global economic and semiconductor industry conditions, rapid demand shifts, technological innovation challenges, international operational risks, Entegris's post-merger debt profile, supply chain constraints, geopolitical factors (like the Russia-Ukraine conflict), currency fluctuations, and the inherent uncertainties of integrating CMC's business and achieving anticipated synergies. The successful closing of the merger is also subject to various conditions, and there's a risk it may not be completed.