IHO Verwaltungs launches €500 million sustainability-linked secured PIK toggle notes

By Paul A. Harris

Portland, Ore., March 23 – IHO Verwaltungs GmbH, the holding company for Schaeffler AG, started a brief roadshow on Thursday for a €500 million offering of sustainability-linked senior secured PIK toggle notes due 2028 (Ba2/expected BB-/expected BB), according to market sources.

Initial yield whisper is in the mid-to-high 8% area, a source said.

Joint bookrunner Deutsche Bank will bill and deliver. BNP Paribas, BofA and Citigroup are also joint bookrunners.

The roadshow is set to wrap up on Friday.

The Rule 144A and Regulation S five-year notes come with two years of call protection. They also feature a 101% poison put.

The Herzogenaurach, Germany-based automotive parts supplier plans to use the proceeds plus cash on hand to redeem €500 million of the outstanding €800 million of its 3 5/8% cash/4 3/8% PIK senior secured PIK toggle notes due 2025 at par plus accrued interest on or about May 15.

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