Schaeffler AG is planning to raise up to €5 billion in debt through an offering of unsecured notes.
The German automotive parts supplier plans to use the proceeds for general corporate and financing purposes, including the repayment of its existing debt.
The company's debt-issuing vehicle, Schaeffler Finance BV, has €2.1 billion outstanding notes on issue as of March 8, according to a base prospectus filed the same day with the Luxembourg Stock Exchange.
Schaeffler Finance's debt includes €500 million 3.50% fixed-rate notes due May 2022, €400 million 2.50% fixed-rate notes due May 2020, €600 million 3.25% fixed-rate notes due May 2025 and €600 million 4.75% fixed-rate notes due May 2023.
The notes to be issued under the latest offering were rated BBB- by S&P Global Ratings and (P)Baa3 by Moody's.
S&P Global Ratings predicts that Schaeffler will maintain some flexibility to manage increasingly difficult industry conditions, while Moody's said it expects Schaeffler's debt/EBITDA to increase slightly but remain below 3.0x.
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