Summary
On March 26, 2020, Lowe's Companies, Inc. successfully issued $4.0 billion in aggregate principal amount of unsecured senior notes across four tranches with varying maturity dates and interest rates. The net proceeds of approximately $3.955 billion are intended to bolster the company's liquidity. These notes are governed by an Amended and Restated Indenture and rank equally with existing unsecured senior indebtedness. The issuance comes at a time when access to capital markets is crucial for maintaining operational flexibility. The notes include covenants that restrict subsidiary debt but not the company's own additional indebtedness. They also feature provisions for redemption at the company's option under specific conditions, including a "Change of Control Triggering Event" where noteholders may require repurchase at 101% of the principal amount plus accrued interest. No established trading market exists for these new securities, and Lowe's does not intend to list them on any exchange.
Key Highlights
- 1Lowe's raised $4.0 billion through the issuance of unsecured senior notes.
- 2The notes are comprised of four tranches: 4.000% Notes due 2025 ($750M), 4.500% Notes due 2030 ($1.25B), 5.000% Notes due 2040 ($750M), and 5.125% Notes due 2050 ($1.25B).
- 3Net proceeds from the issuance were approximately $3.955 billion.
- 4The notes are unsecured and rank equally with existing unsecured senior indebtedness.
- 5The indenture restricts subsidiary debt issuance but not the company's own ability to incur additional debt.
- 6Notes are redeemable at the company's option prior to maturity, with varying conditions for each tranche.
- 7A 'Change of Control Triggering Event' allows noteholders to demand repurchase at 101% of principal plus accrued interest.