8-KFinancial EventsOther EventsExhibits & Filings

Prologis, Inc. 8-K Report, Financial Obligation (Jun 23, 2020)

Filed June 23, 2020For Securities:PLDPLDGP

Summary

Prologis, Inc. (PLD), through its operating partnership Prologis, L.P., has announced the pricing of a significant offering of Yen-denominated notes across various maturities, ranging from 2027 to 2050. This issuance, totaling approximately ¥43.2 billion (around $380.6 million USD based on exchange rates at the time), aims to raise capital for strategic purposes. The proceeds are earmarked for financing green projects, general corporate needs, and specifically to fund a cash tender offer for maturing notes due in 2022 and 2024, as well as potentially repaying revolving credit facilities. The company is leveraging a diversified debt issuance strategy, securing funds at notably low interest rates, with the shortest maturity (2027 notes) carrying a 0.589% coupon and the longest (2050 notes) at 1.600%. This move suggests a proactive approach to managing its capital structure and taking advantage of favorable borrowing conditions in the Japanese market. The notes are senior unsecured obligations of Prologis Yen Finance LLC and are fully guaranteed by Prologis, L.P., indicating a strong backing for this debt issuance.

Key Highlights

  • 1Prologis priced a ¥43.2 billion offering of Yen-denominated notes with maturities spanning 2027 through 2050.
  • 2The estimated net proceeds from the offering are approximately ¥40.9 billion ($380.6 million USD).
  • 3Proceeds will be used for financing Eligible Green Projects, general corporate purposes, and to fund a cash tender offer for existing notes maturing in 2022 and 2024.
  • 4Interest rates on the notes are low, ranging from 0.589% (2027 Notes) to 1.600% (2050 Notes).
  • 5The notes are senior unsecured obligations of Prologis Yen Finance LLC and are fully and unconditionally guaranteed by Prologis, L.P.
  • 6The issuance is part of a broader capital markets access strategy, utilizing a shelf registration statement filed with the SEC.
  • 7The offering reflects Prologis's strategy to diversify funding sources and manage its debt maturities proactively.

Frequently Asked Questions

The primary purpose of this debt issuance is to raise capital for several strategic initiatives. These include financing Prologis's 'Eligible Green Project Portfolio,' general corporate purposes, funding a cash tender offer for existing notes maturing in 2022 and 2024, and potentially repaying borrowings under revolving credit facilities.

The notes have various interest rates and maturity dates: 0.589% due 2027, 0.850% due 2030, 1.003% due 2032, 1.222% due 2035, and 1.600% due 2050. The aggregate principal amount is ¥43.2 billion.

Net proceeds from the 2030 and 2035 Notes are intended for the Eligible Green Project Portfolio and general corporate purposes, including debt repayment. Proceeds from the 2027, 2032, and 2050 Notes are intended to fund the cash tender offer for 3.000% Notes due 2022 and 3.375% Notes due 2024, and potentially other general corporate purposes or debt repayment. In the short term, proceeds may also be used to repay revolving credit facilities.

The total aggregate principal amount of the notes is ¥43.2 billion. The estimated net proceeds to Prologis Yen Finance LLC are approximately ¥40.9 billion, which is equivalent to about $380.6 million USD, based on the exchange rate as of June 12, 2020.