Summary
Stryker Corporation (SYK) has announced a significant debt offering, successfully completing a public offering of €2.4 billion in notes across three tranches: €850 million of 0.250% Notes due 2024, €800 million of 0.750% Notes due 2029, and €750 million of 1.000% Notes due 2031. This offering, filed on December 3, 2019, was executed under an existing shelf registration statement and utilizes a base indenture supplemented by three new indentures. The primary stated purpose of these proceeds is to finance the acquisition of Wright Medical Group N.V. and cover related expenses, with any remaining funds allocated for general corporate purposes. A key detail for investors is the inclusion of a special mandatory redemption clause for the 2024 and 2031 Notes, requiring Stryker to redeem them at 101% of principal plus accrued interest if the Wright Medical acquisition is not completed by February 4, 2021, or if the purchase agreement is terminated. The 2029 Notes are excluded from this special redemption feature.
Key Highlights
- 1Completion of a public offering of €2.4 billion in notes across three tranches: 0.250% due 2024, 0.750% due 2029, and 1.000% due 2031.
- 2Net proceeds are approximately €2,376 million (or $2,621 million) to be used for the acquisition of Wright Medical Group N.V. and related costs.
- 3Special mandatory redemption for 2024 and 2031 Notes at 101% if Wright Medical acquisition does not close by February 4, 2021, or agreement is terminated.
- 4The 2029 Notes are not subject to the special mandatory redemption tied to the Wright Medical acquisition.
- 5The offering was conducted under an existing Form S-3 shelf registration statement, indicating pre-approved ability to issue debt.
- 6The Indenture includes covenants limiting the incurrence of liens, sale and leaseback transactions, and asset dispositions.
- 7A change of control event coupled with a downgrade to below investment grade by both Moody's and S&P triggers a mandatory offer to repurchase the notes at 101%.