McDermott International, Inc. Announces Pricing of $1.3 Billion of 10.625% Senior Unsecured Notes due 2024
April 04 2018 - 5:02PM
McDermott International, Inc. (NYSE:MDR) (“McDermott”) today
announced that McDermott Technology (Americas), Inc. and McDermott
Technology (US), Inc. (together, the “Post-Merger Co-Issuers”),
each a wholly owned subsidiary of McDermott, have priced $1.3
billion in aggregate principal amount of 10.625% senior unsecured
notes due 2024 (the “notes”). Settlement of the offering is
expected to occur on April 18, 2018, subject to customary closing
conditions.
The notes will be initially issued by McDermott
Escrow 1, Inc. and McDermott Escrow 2, Inc. (together, the “Escrow
Issuers”), each of which is a special purpose entity incorporated
under the laws of the State of Delaware and is wholly owned by
Stichting Hydra Notes, a foundation organized under the laws of the
Netherlands.
The proceeds of the offering will be deposited into
a segregated escrow account until the date on which certain escrow
conditions are satisfied and the escrow proceeds are released (the
“Escrow Conditions”). Concurrent with the satisfaction of the
Escrow Conditions, the Escrow Issuers will merge with and into the
Post-Merger Co-Issuers, with each Post-Merger Co-Issuer being a
surviving entity that will assume, by operation of law, the
obligations of the applicable Escrow Issuer under the notes and the
indenture governing the notes.
Upon the consummation of the business combination
(the “Combination”) between McDermott and Chicago Bridge & Iron
Company N.V. (“CB&I”), the notes will be jointly and severally
guaranteed on a senior unsecured basis by McDermott, each of
McDermott’s and CB&I’s material restricted subsidiaries (other
than the Post-Merger Co-Issuers) that guarantees indebtedness of
either Post-Merger Co-Issuer or any guarantor under McDermott’s
credit agreement.
Upon satisfaction of the Escrow Conditions, McDermott intends to
use the net proceeds from the offering of the notes to pay a
portion of the purchase price for the pending acquisition of the
technology operations of CB&I in connection with the
Combination.
The notes will be subject to a special mandatory
redemption if the Escrow Conditions are not satisfied or the
issuers of the notes determine in their discretion that the Escrow
Conditions are incapable of being satisfied on or prior to the
applicable outside date, which in any event will be on or before
June 29, 2018.
The notes have been offered only to qualified institutional
buyers under Rule 144A under the Securities Act of 1933, as amended
(the “Securities Act”), and to certain non-U.S. persons in
transactions outside the United States under Regulation S under the
Securities Act.
The notes have not been and will not be registered under the
Securities Act or any state securities laws; and unless so
registered, may not be offered or sold in the United States except
pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act and applicable
state securities laws.
This press release is for informational purposes only and shall
not constitute an offer to sell or the solicitation of an offer to
buy the notes or any other securities, nor shall there be any sale
of notes or any other securities in any jurisdiction in which such
offer, solicitation or sale would be unlawful.
Forward-Looking Statements
All statements other than statements of historical fact included
in this release are forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements in this press release relate to, among
other things, the timing of the closing, the expected use of
proceeds from the offering, the satisfaction of the Escrow
Conditions relating to and release of the escrowed proceeds from
the offering, the mergers between the Escrow Issuers and the
Post-Merger Co-Issuers and any special mandatory redemption.
Although we believe that the expectations reflected in those
forward-looking statements are reasonable, we can give no assurance
that those expectations will prove to have been correct.
Those statements are made by using various underlying assumptions
and are subject to various uncertainties. This news release
reflects expectations as of the date hereof. Except to the extent
required by applicable law, McDermott undertakes no obligation to
update or revise any forward-looking statement.
Investors & Financial MediaTy LawrenceVice President,
Investor
Relations 281.870.5147TPLawrence@mcdermott.com
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