8-KOther EventsExhibits & Filings

Seagate Technology Holdings plc 8-K Report, Corporate Update (Sep 19, 2006)

Filed September 19, 2006For Securities:STX

Summary

Seagate Technology Holdings plc (STX) has announced the pricing of a significant debt offering totaling $1.5 billion, comprised of $300 million in Floating Rate Senior Notes due 2009, $600 million in 6.375% Senior Notes due 2011, and $600 million in 6.800% Senior Notes due 2016. These notes will be issued by a wholly-owned subsidiary and fully guaranteed by Seagate Technology, with an expected closing date of September 20, 2006. This offering represents a strategic move to refinance existing debt and fund substantial shareholder returns. The primary uses of the net proceeds are to redeem $400 million of existing 8% Senior Notes due 2009, partially fund a $2.5 billion stock repurchase program, and for general corporate purposes. This financing structure aims to improve the company's debt maturity profile and enhance shareholder value through the buyback program, while also providing flexibility for ongoing operations.

Key Highlights

  • 1Pricing of $1.5 billion aggregate principal amount of Senior Notes: $300M (2009), $600M (2011), $600M (2016).
  • 2Notes will be issued by Seagate Technology HDD Holdings and guaranteed by Seagate Technology.
  • 3Expected closing date for the offering is September 20, 2006.
  • 4Proceeds will be used to redeem $400 million of 8% Senior Notes due 2009.
  • 5A portion of the proceeds will fund the previously announced $2.5 billion stock repurchase program.
  • 6Remaining proceeds will be used for general corporate purposes.
  • 7Underwriting Agreement filed as an exhibit.

Frequently Asked Questions

Seagate is issuing a total of $1.5 billion in aggregate principal amount of Senior Notes across three tranches: $300 million of Floating Rate Senior Notes due 2009, $600 million of 6.375% Senior Notes due 2011, and $600 million of 6.800% Senior Notes due 2016.

The net proceeds are intended to redeem $400 million of its 8% Senior Notes due 2009, to fund a portion of its previously announced $2.5 billion stock repurchase program, and for general corporate purposes.

The offering is expected to close on September 20, 2006.

The 2009 Notes will bear interest at a floating rate (three-month LIBOR plus 0.84%) and are not redeemable before maturity. The 2011 Notes will have a fixed rate of 6.375% and the 2016 Notes will have a fixed rate of 6.800%. Both the 2011 and 2016 Notes can be redeemed prior to maturity at a specified make-whole premium.