Summary
Stryker Corporation (SYK) announced on June 4, 2020, the completion of a significant public offering of debt, raising a total of $2.273 billion in net proceeds after accounting for underwriting discounts and expenses. This offering comprised three tranches: $650 million of 1.150% Notes due 2025, $1 billion of 1.950% Notes due 2030, and $650 million of 2.900% Notes due 2050. The issuance was made under Stryker's existing shelf registration statement and supplements the company's capital structure with long-term debt. The primary purpose of this debt issuance is to fund the company's ongoing acquisition of Wright Medical Group N.V. ("Wright"), including associated fees and expenses. The proceeds from this offering, combined with a previous €2.4 billion notes offering in December 2019 and other financing sources, are earmarked for consummating the Wright acquisition. This strategic move signals Stryker's commitment to expanding its operations and market presence through significant M&A activity.
Key Highlights
- 1Stryker completed a public offering raising $2.273 billion in net proceeds.
- 2The debt offering consisted of $650 million in 1.150% Notes due 2025, $1 billion in 1.950% Notes due 2030, and $650 million in 2.900% Notes due 2050.
- 3The proceeds are primarily intended to finance the acquisition of Wright Medical Group N.V.
- 4The 2025 and 2030 Notes are subject to a special mandatory redemption if the Wright acquisition is not consummated by February 4, 2021, or if the purchase agreement is terminated.
- 5The 2050 Notes are not subject to this special mandatory redemption.
- 6Stryker retains the option to redeem all tranches of notes prior to maturity at specified redemption prices, including a make-whole premium.
- 7The Indenture includes covenants that restrict Stryker's ability to incur certain liens, engage in sale-leaseback transactions, and undergo mergers or asset sales.