8-KOther EventsExhibits & Filings

LINDE PLC 8-K Report, Corporate Update (Aug 10, 2020)

Filed August 10, 2020For Securities:LIN

Summary

Linde plc, through its wholly owned subsidiary Praxair, Inc., announced on August 10, 2020, the issuance of $1 billion in aggregate principal amount of senior notes. This issuance comprises $700 million of 1.100% notes due 2030 and $300 million of 2.000% notes due 2050. The notes are fully and unconditionally guaranteed by Linde plc and further guaranteed by Linde GmbH. These new notes aim to refinance existing debt, specifically Praxair's outstanding 4.05% notes due March 2021 and 3.00% notes due September 2021, with any remaining proceeds allocated for general corporate purposes. This move represents a proactive debt management strategy by Linde plc, leveraging favorable interest rates to reduce future interest expenses and extend debt maturities. The offering, which generated approximately $990 million in net proceeds after fees, demonstrates the company's access to capital markets and its commitment to optimizing its capital structure. Investors should view this as a positive step towards financial flexibility and potential cost savings.

Key Highlights

  • 1Linde plc subsidiary Praxair, Inc. issued $1 billion in new senior notes.
  • 2The notes consist of $700 million due 2030 at 1.100% interest and $300 million due 2050 at 2.000% interest.
  • 3Net proceeds from the issuance are approximately $990 million.
  • 4The primary use of proceeds is to redeem, repurchase, or repay Praxair's 4.05% notes due March 2021 and 3.00% notes due September 2021.
  • 5Linde plc and Linde GmbH provide full and unconditional guarantees for the new notes.
  • 6The issuance reflects proactive debt management and refinancing of existing debt at lower interest rates.
  • 7The filing includes details of the underwriting agreement, indenture, and forms of the notes.

Frequently Asked Questions

The primary purpose of this debt issuance is to refinance existing, higher-interest debt of Praxair, Inc. Specifically, Linde intends to use the proceeds to redeem, repurchase, or repay Praxair's outstanding 4.05% notes due March 2021 and 3.00% notes due September 2021. This allows the company to secure new debt at significantly lower interest rates and potentially extend its debt maturity profile.

This debt issuance is generally positive for Linde plc's financial health. By refinancing existing debt at lower interest rates (1.100% and 2.000% compared to 4.05% and 3.00%), the company is expected to reduce its future interest expenses. The net proceeds of approximately $990 million also indicate efficient execution of the offering. The company's access to capital markets and its ability to issue guaranteed debt further demonstrate its financial stability and flexibility.

The new notes issued by Praxair, Inc. are fully and unconditionally guaranteed by Linde plc. Additionally, Linde GmbH, another wholly owned subsidiary of Linde plc, also provides a guarantee for Linde plc's guarantee. This multi-layered guarantee structure enhances the creditworthiness and security of the notes for investors.

Linde plc, through Praxair, Inc., is issuing two series of notes: $700 million aggregate principal amount of 1.100% notes due August 10, 2030, and $300 million aggregate principal amount of 2.000% notes due August 10, 2050. The notes were issued under an indenture dated August 10, 2020.