Summary
Lowe's Companies, Inc. (LOW) filed an 8-K report on April 20, 2016, to announce a significant debt financing transaction. The company issued an aggregate of $3.3 billion in unsecured notes, comprising $250 million in floating rate notes due 2019 and $3.05 billion in fixed-rate notes maturing in 2019, 2026, and 2046, with coupon rates ranging from 1.15% to 3.70%. The primary purpose of this issuance was to secure substantial capital, with net proceeds of approximately $3.26 billion. These notes are governed by an indenture and rank equally with existing and future unsecured senior indebtedness. The company has the option to redeem the fixed-rate notes under specific conditions, and noteholders have the right to require repurchase in the event of a Change of Control Triggering Event.
Key Highlights
- 1Lowe's raised $3.3 billion in unsecured notes through a new debt issuance on April 20, 2016.
- 2The notes are comprised of $250 million in Floating Rate Notes due April 15, 2019, and $3.05 billion in Fixed Rate Notes across three maturities: April 15, 2019 (1.15%), April 15, 2026 (2.50%), and April 15, 2046 (3.70%).
- 3Net proceeds from the issuance were approximately $3.26 billion.
- 4The notes are unsecured and rank pari passu with existing and future unsecured senior indebtedness.
- 5The company has the right to redeem fixed-rate notes under certain conditions and premium structures.
- 6Noteholders can require repurchase at 101% of principal plus accrued interest in case of a Change of Control Triggering Event.
- 7No established trading market exists for these new notes, and Lowe's does not intend to list them on an exchange.