Bombardier restructures debt


Bombardier has issued US$2 billion in senior notes at a comparatively high-yield to finance tender offers due in 2020 and 2021.

The Canadian jet manufacturer initially targeted an issue of $1 billion but announced shortly after that it doubled the amount. The senior notes carry a coupon of 7.875% and will be sold at 99.246% of par.

The issuance is expected to close on 7 March 2019 and is due for redemption in 2027.

Net proceeds from the notes will be used to finance all the outstanding amount of the company’s current 2020 notes – of which there is $850 million left to cover. The rest will be used to help cover the purchase and redemption of up to $975 million in notes due 2021.

The 2021 notes are divided into 6⅛% notes of which there is €780 million outstanding and 8.75% notes of which there is approximately $1.4 billion outstanding. The issuance will also be used to pay related fees and expenses and any remaining amounts will be used to finance general corporate purposes.

This issue follows shortly after Bombardier published its annual results and reported improved cash flow in the last three months of 2018. It also expects to achieve $18 billion in sales in 2019.