Summary
Thermo Fisher Scientific Inc. (TMO) announced on October 8, 2019, the successful issuance of $900 million in aggregate principal amount of 2.600% Senior Notes due 2029. This offering complements a significant Euro Offering completed on September 30, 2019, which raised €4.6 billion across multiple tranches with varying maturities and coupon rates. The proceeds from these debt issuances are primarily earmarked for refinancing existing debt, including the redemption of several tranches of senior notes totaling approximately $4.5 billion, as well as commercial paper issued to fund prior redemptions. These notes are unsecured and rank equally with the company's existing unsecured and unsubordinated debt, while being effectively subordinated to secured debt and structurally subordinated to debt at subsidiaries. The indenture includes limited covenants restricting the company's ability to incur secured debt on principal properties or engage in certain sale-leaseback transactions, and also limits merger and asset sale activities. This strategic refinancing aims to optimize the company's capital structure and manage its debt maturity profile.
Key Highlights
- 1Issuance of $900 million in 2.600% Senior Notes due October 1, 2029.
- 2Proceeds to be used for refinancing existing debt and funding redemptions of other senior notes.
- 3Complements a large Euro Offering (€4.6 billion) of senior notes completed earlier.
- 4Notes are unsecured and rank equally with other unsecured and unsubordinated debt.
- 5Effectively subordinated to secured debt and structurally subordinated to subsidiary debt.
- 6Indenture includes covenants limiting secured debt, sale-leaseback transactions, mergers, and asset sales.
- 7Company may redeem notes prior to maturity under specific conditions, including a 'Par Call' option and a change of control provision.