8-KMaterial AgreementsFinancial EventsExhibits & Filings

Prologis, Inc. 8-K Report, Material Agreement (Jun 6, 2017)

Filed June 6, 2017For Securities:PLDPLDGP

Summary

Prologis, Inc. (PLD) announced on June 5, 2017, through its operating partnership Prologis, L.P., the pricing of a £500 million (approximately $635 million) offering of 2.250% Notes due 2029. This debt issuance is a significant event for investors as it allows the company to strategically manage its capital structure and debt obligations. The proceeds are earmarked for the redemption of higher-coupon notes maturing in 2019, thereby reducing interest expense and improving the company's overall cost of capital. The company also plans to use remaining proceeds for general corporate purposes, including repaying other indebtedness and short-term borrowings under its multi-currency senior term loan. This proactive approach to debt management suggests a focus on optimizing financial flexibility and deleveraging where advantageous, which could be viewed positively by investors seeking financial stability and efficient capital allocation from Prologis.

Key Highlights

  • 1Prologis L.P. priced an offering of £500 million (approx. $635 million) in 2.250% Notes due 2029.
  • 2Net proceeds are estimated to be approximately £496 million ($635 million) after offering expenses.
  • 3A portion of the proceeds will be used to redeem one or more series of existing notes maturing in 2019, including 6.625%, 2.750%, and 7.375% notes.
  • 4The remaining net proceeds will be used for general corporate purposes, including repaying other indebtedness and short-term borrowings.
  • 5The Notes bear interest at a low rate of 2.250% per annum, maturing on June 30, 2029.
  • 6The Notes are senior unsecured obligations of Prologis L.P., fully guaranteed by Prologis, Inc.
  • 7The offering is being conducted under a shelf registration statement filed with the SEC.

Frequently Asked Questions

The primary purpose is to refinance existing, higher-interest debt that matures in 2019. By issuing new notes at a lower interest rate (2.250%), Prologis aims to reduce its overall interest expense and optimize its capital structure. Remaining funds will be used for general corporate purposes and to repay other debts.

Prologis, L.P. priced an offering of £500,000,000 in aggregate principal amount of Notes. The net proceeds, after deducting underwriters' discounts and offering expenses, are estimated to be approximately £496 million, which equates to roughly $635 million based on the sterling/U.S. dollar exchange rate at the time.

The company intends to use a portion of the proceeds for the full or partial redemption of one or more series of its notes due in 2019. This specifically includes its 6.625% notes due December 1, 2019, its 2.750% notes due February 15, 2019, and its 7.375% notes due October 30, 2019.

The Notes mature on June 30, 2029, and carry a fixed interest rate of 2.250% per annum, payable annually in arrears on June 30 of each year, starting June 30, 2018. They are senior unsecured obligations of Prologis, L.P., with a full and unconditional guarantee from Prologis, Inc.