Bombardier Inc. is offering to buy back up to $550-million (U.S.) of its outstanding debt securities for cash, in a refinancing that the company says will take advantage of current favourable conditions on capital markets.
The Quebec-based rail and aerospace manufacturer says the offer is subject to several conditions, including that Bombardier receives no less than $1-billion from a placement of new senior notes with later maturities.
Bombardier also said it may increase the cap of its tender offer to $1.25-billion, but isn't obliged to do so.
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For now, Bombardier's offer applies to 6.75 per cent notes that mature 2012, 6.3 per cent notes due 2014 and euro-denominated floating-rate notes due in 2013.
The tender offer will expire at 9 a.m. ET on March 9. Notes that are tendered to the offer may be withdrawn at any time prior to 5 p.m. ET on Feb. 22 but may not be withdrawn after that.
The amount that Bombardier will pay for the outstanding notes varies by maturity date. In addition, it will pay a premium for notes that are tendered by the Feb. 22 deadline.
There are $550-million of the 2012 notes outstanding, $500-million of the 2014 notes outstanding and €679-million of the 2013 notes outstanding.
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In a separate announcement, Bombardier says a German customer has ordered 48 additional Talent 2 trains from Bombardier for €200-million, the equivalent of about $272-million (U.S.).
The latest purchase brings the total number of Talent 2 vehicles ordered by Deutsche Bahn (DB) AG to 176.