Trinseo (NYSE: TSE), a global materials solutions provider and manufacturer of plastics, latex binders and synthetic rubber, today announced the pricing of both its offering of $450 million in gross proceeds of senior notes due 2029 (the “Notes”) by its subsidiaries Trinseo Materials Operating S.C.A. and Trinseo Materials Finance, Inc. (together, the “Issuers”) and of its $750 million of incremental term loan borrowings expected to be available under the Issuers’ existing senior secured credit facility (“Term Loan B Facility”). The net proceeds from the Notes offering and Term Loan B, together with available cash, will be used to pay the purchase price of the previously-announced acquisition of the polymethyl methacrylates (PMMA) and activated methyl methacrylates (MMA) business, through the purchase of shares of certain subsidiaries of Arkema S.A. (the “Acquisition”), in addition to fees and expenses related to the offerings and Acquisition.
The Notes will bear interest at a rate of 5.125% and will mature on April 1, 2029. The Issuers have been notified by the lead arrangers that they expect that the Term Loan B Facility will be fully subscribed. The Term Loan B Facility will bear an interest rate of the London Interbank Offered Rate (“LIBOR”) plus 2.50%, subject to a 0.00% LIBOR floor, and will mature in May 2028. The commitments in respect to the Term Loan B Facility and the terms and conditions thereof (including the applicable interest rate) remain subject to execution of the definitive documentation with respect to the Term Loan B Facility, which is expected to occur concurrently with the closing of the Acquisition.
Including the impact of these offerings, our estimated annual cash interest is expected to be approximately $83 million, based on the current LIBOR rate.
This press release does not constitute an offer to sell or the solicitation of an offer to buy the Notes. The Notes to be offered have not been, and will not be, registered under the Securities Act of 1933, as amended (the “Securities Act”), or any applicable state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and other applicable state securities laws. The Notes are being offered only to persons reasonably believed to be qualified institutional buyers in the United States in reliance on Rule 144A under the Securities Act and outside the United States only to non-U.S. investors pursuant to Regulation S under the Securities Act.
Trinseo (NYSE: TSE) is a global materials solutions provider and manufacturer of plastics, latex binders, and synthetic rubber with a focus on delivering innovative, sustainable, and value-creating products that are intrinsic to our daily lives. Trinseo is dedicated to making a positive impact on society by partnering with like-minded stakeholders, and supporting the sustainability goals of our customers in a wide range of end-markets including automotive, consumer electronics, appliances, medical devices, packaging, footwear, carpet, paper and board, building and construction, and tires. Trinseo had approximately $3.0 billion in net sales in 2020, with 17 manufacturing sites around the world, and approximately 2,600 employees. For more information, please visit: www.trinseo.com.
Note on Forward-Looking Statements
This press release may contain forward-looking statements including, without limitation, statements concerning plans, objectives, goals, projections, strategies, future events or performance, and underlying assumptions and other statements, which are not statements of historical facts or guarantees or assurances of future performance. Forward-looking statements may be identified by the use of words like “expect,” “anticipate,” “will,” “may, or expressions of similar meaning. Forward-looking statements reflect management’s evaluation of information currently available and are based on our current expectations and assumptions regarding our Term Loan B Facility and expected cost savings as a result of our refinancing transactions, the timing of the proposed Acquisition; estimated and future results of operations, business strategies, competitive position, industry environment and potential growth opportunities and cost synergies relating to the Acquisition, our business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Factors that might cause such a difference include, but are not limited to, our failure to complete the Acquisition or meet the conditions to closing, including antitrust, works council and other regulatory approvals; the failure to obtain the financing necessary to fund the Acquisition and the impact of the substantial indebtedness to be incurred; costs related to the Acquisition; following the Acquisition, our ability to successfully integrate the acquired businesses, generate expected cost savings and synergies, maintain relationships with customers, retain key employees and profitably grow the business; and those factors discussed in our Annual Report on Form 10-K, under Part I, Item 1A —“Risk Factors” and elsewhere in our other reports, filings and furnishings made with the U.S. Securities and Exchange Commission from time to time. As a result of these or other factors, our actual results may differ materially from those contemplated by the forward-looking statements. Therefore, we caution you against relying on any of these forward-looking statements. The forward-looking statements included in this press release are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.
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