By William Gullotti
Buffalo, N.Y., Feb. 9 – Carraro Finance SA priced an offering of up to €120 million of non-convertible bonds due 2028 at par, according to two notices on Wednesday.
The Regulation S bonds will be guaranteed by Carraro SpA.
The bonds will bear fixed interest at a minimum of 2¾%, which will be finalized after the bookbuilding period closes.
The final aggregate total of bonds issued will be determined during the offering period and is subject to a floor of €100 million. The offering period is scheduled to open Feb. 23 and expire March 1 with a provision to close early should the €120 million maximum amount be met prior to expiration.
The bonds may be redeemed early in whole, but not in part, at any time for tax reasons at par plus interest. The issuer will also have the option to redeem the bonds in whole or in part beginning March 9, 2024. From March 9, 2024 up to and including March 8, 2025, the notes may be redeemed at par plus 50% of the rate of interest. From March 9, 2025 up to and including March 8, 2026, the notes may be redeemed at par plus 25% of the rate of interest. From March 9, 2026 up to and including March 8, 2027, the notes may be redeemed at par plus 12.5% of the rate of interest. From March 9, 2027 up to and excluding maturity, the notes may be redeemed at par.
Noteholders will be able to put the notes at 101 plus interest if a change of control occurs.
Equita SIM SpA will act as the placement agent.
Proceeds from the offering will be used mainly to refinance existing debt including the early repayment in full of the €180 million 3½% senior notes due Jan. 31, 2025 issued Feb. 7, 2018 by Carraro International SE (ISIN: XS1747134564).
Application has been made to list the bonds on the regulated markets of both the Luxembourg Stock Exchange and Borsa Italiana SpA.
Carraro makes eco-compatible power transmission systems primarily for agricultural machinery. The Campodarsego, Padua, Italy-based company has production plants in India, Argentina, China, South Africa and Brazil.
| Issuer: | Carraro Finance SA
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| Guarantor: | Carraro SpA
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| Issue: | Bonds
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| Amount: | Between €100 million and €120 million
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| Maturity: | March 9, 2028
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| Placement agent: | Equita SIM SpA
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| Counsel to issuer: | Gianni & Origoni (English and Italy), GDM Avocats (Luxembourg)
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| Counsel to agent: | Linklaters LLP (English and Luxembourg), Linklaters Studio Legale Associato (Italy)
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| Coupon: | Floor of 2¾%
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| Price: | Par
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| Yield: | Minimum 2¾%
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| Calls: | At any time for taxation reasons at par plus interest; from March 9, 2024 up to and including March 8, 2025 at any time at par plus 50% of the rate of interest; from March 9, 2025 up to and including March 8, 2026 at any time at par plus 25% of the rate of interest; from March 9, 2026 up to and including March 8, 2027 at any time at par plus 12.5% of the rate of interest; from March 9, 2027 up to and including March 8, 2028 at any time at par
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| Change of control: | At 101 plus interest
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| Pricing date: | Feb. 9
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| Offering period: | Feb. 23 to March 1
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| Settlement date: | March 9
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| Distribution: | Regulation S
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| ISIN: | XS2432299365
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