PALM BEACH GARDENS, Fla. - Carrier Global Corporation (NYSE:CARR), a leader in climate and energy solutions, has initiated tender offers to purchase up to $800 million of its outstanding debt securities. The operation includes a series of notes with varying levels of acceptance priority and fixed spreads, as detailed in the company's official offer to purchase dated today.
The tender offers are targeting five different series of notes, with the highest priority given to the 5.900% Notes due 2034 and the 6.200% Notes due 2054, which have series tender caps of $125 million and $350 million respectively. Other notes included in the offer are the 3.577% Notes due 2050, the 3.377% Notes due 2040, and the 2.242% Notes due 2025.
Investors who tender their securities by the early deadline of 5:00 p.m. New York City time on August 8, 2024, will be eligible for the Total Consideration, which includes an Early Tender Payment of $30.00 per $1,000 principal amount. Securities tendered after the early deadline but before the expiration date will receive the Late Tender Offer Consideration plus accrued interest.
The total consideration for each series of securities will be calculated based on the fixed spread specified in the offer document plus the yield of the corresponding U.S. Treasury Reference Security. The tender offers will expire at 11:59 p.m., New York City time, on August 22, 2024, unless extended or terminated earlier.
Securities accepted for purchase will be paid for promptly following the expiration date, which is currently anticipated to be August 27, 2024. However, the company reserves the right to settle early, potentially on August 13, 2024, for securities tendered by the early deadline.
These tender offers are part of Carrier's financial strategy and are subject to certain conditions outlined in the offer to purchase. The company has not set a minimum tender condition but has stated the offers are subject to the aggregate purchase price and series tender caps.
Morgan Stanley, J.P. Morgan, and Wells Fargo Securities are acting as lead dealer managers, with Deutsche Bank Securities and Goldman Sachs & Co. LLC serving as co-dealer managers. D.F. King & Co., Inc. has been appointed as the tender and information agent for the offers.
This move comes as part of Carrier's ongoing efforts to manage its debt portfolio effectively. The company emphasizes that neither it nor its affiliates are making any recommendations to holders regarding the tendering of securities. This initiative is based on a press release statement issued by Carrier Global Corporation.
In other recent news, Carrier Global Corp . has reported notable increases in its second quarter of 2024 earnings. The company's adjusted earnings per share (EPS) rose by 10% year-over-year to $0.87, while free cash flow surged by 35% to roughly $550 million. Organic orders, particularly HVAC orders, saw a significant rise, increasing by over 40%.
Carrier Global has also announced plans for a multi-billion dollar share buyback and set its full-year reported sales guidance at approximately $25.5 billion. Despite facing challenges in certain sectors, the company maintains its focus on becoming a global leader in intelligent climate and energy solutions.
Analysts at Baird have adjusted their price target for Carrier Global to $74, maintaining an Outperform rating. The firm cites several factors influencing this decision, including a mix of positive and negative developments in the company's recent quarter.
These recent developments also include a collaboration with Viessmann Climate Solutions to leverage growth opportunities and synergies. Investments in connectivity, AI, and sustainable solutions remain central to Carrier Global's strategy.
InvestingPro Insights
As Carrier Global Corporation (NYSE:CARR) announces its strategic move to manage its debt portfolio through tender offers, investors are keen to understand the company's financial health and future outlook. According to InvestingPro data, Carrier boasts a solid market capitalization of $58.53 billion, underscoring its significant presence in the industry.
The company's P/E ratio stands at 16.95, suggesting a potentially attractive valuation relative to its earnings. Additionally, Carrier's revenue growth has been positive, with an 8.63% increase over the last twelve months as of Q2 2024, indicating a strong capacity for generating income.
Considering InvestingPro Tips, Carrier has demonstrated a commitment to shareholder returns by raising its dividend for four consecutive years. This consistent dividend growth aligns with the company's robust financial strategy and could be a reassuring signal to investors during the current tender offers.
Furthermore, analysts predict Carrier will remain profitable this year, which is supported by the company's profitability over the last twelve months. These factors contribute to Carrier's appeal as an investment, particularly for those seeking steady income and long-term growth potential.
For investors looking for more in-depth analysis and additional insights, InvestingPro offers a comprehensive suite of tools and metrics. Currently, there are 12 more InvestingPro Tips available for Carrier Global Corporation, which can be accessed at: https://www.investing.com/pro/CARR. To enhance your investment decisions, use coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
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