- Announces proposed offering of $500
million of senior notes due 2029
- The acquisition will be financed with the proceeds from the
proposed notes offering and use of the expanded revolver
WOOD
DALE, Ill., Feb. 14,
2024 /PRNewswire/ -- AAR CORP. ("AAR" or the
"Company") (NYSE: AIR), a leading provider of aviation services to
commercial and government operators, MROs and OEMs, announced today
that AAR Escrow Issuer, LLC, a wholly owned, unrestricted
subsidiary of the Company (the "Escrow Issuer"), intends to offer,
subject to market conditions and other factors, $500 million aggregate principal amount of senior
notes due 2029 (the "Notes").
The Company intends to use the net proceeds of the proposed
senior notes offering to fund a portion of the purchase price for
its pending acquisition of Triumph Group's (NYSE: TGI) Product
Support business (the "Triumph Product Support Acquisition").
Substantially concurrently with the consummation of the Triumph
Product Support Acquisition, the Company intends to amend its
revolving credit facility (the "Revolving Credit Facility") to,
among other things, increase the aggregate lending commitments
thereunder from $620 million to at
least $795 million. The Company
intends to fund the balance of the acquisition consideration with
cash on hand and borrowings under the Revolving Credit Facility, as
amended.
If the proposed senior notes offering closes prior to the
consummation of the Triumph Product Support Acquisition, (1) the
gross proceeds from the offering will be deposited into an escrow
account for the benefit of the holders of the Notes until the date
on which certain escrow conditions are satisfied, including the
closing of the Triumph Product Support Acquisition, and (2) the
Notes will be subject to a special mandatory redemption at a price
equal to 100% of the initial issue price of the Notes, plus accrued
and unpaid interest, if any, from the issue date of the Notes, to,
but excluding, the date of the special mandatory redemption. If the
proposed senior notes offering closes substantially concurrently
with the consummation of the Triumph Product Support Acquisition,
the Notes will not be subject to the aforementioned procedures.
Prior to the consummation of the Triumph Product Support
Acquisition, the Notes will be the sole obligation of the Escrow
Issuer. Substantially concurrently with the consummation of the
Triumph Product Support Acquisition, the Escrow Issuer will merge
with and into the Company, with the Company continuing as the
surviving entity. The Company will then assume the obligations of
the Escrow Issuer under the Notes and the indenture governing the
Notes, and the Notes will be fully and unconditionally
guaranteed by each of the Company's subsidiaries that guarantee the
Company's obligations under the Revolving Credit Facility.
The Notes and the related guarantees have not been and will not
be registered under the Securities Act of 1933, as amended (the
"Securities Act"), any state securities laws or the securities laws
of any other jurisdiction. The Notes and the related guarantees may
not be offered or sold in the United
States or to, or for the benefit of, U.S. persons absent
registration or pursuant to an exemption from, or in a transaction
not subject to, registration. The Notes and related guarantees will
be offered and sold only to persons reasonably believed to be
"qualified institutional buyers" in accordance with Rule 144A under
the Securities Act and to certain non-U.S. persons in offshore
transactions in reliance on Regulation S under the Securities
Act.
This press release is neither an offer to sell, nor the
solicitation of an offer to buy, the Notes or any other securities
and shall not constitute an offer to sell or a solicitation of an
offer to buy, or a sale of, the Notes or any other securities in
any state or jurisdiction in which such offer, solicitation or sale
would be unlawful.
About AAR
AAR is a global aerospace and defense aftermarket solutions
company with operations in over 20 countries. Headquartered in the
Chicago area, AAR supports
commercial and government customers through four operating
segments: Parts Supply, Repair & Engineering, Integrated
Solutions and Expeditionary Services.
Forward-Looking Statements
This press release contains certain statements relating to
future results, which are forward-looking statements as that term
is defined in the Private Securities Litigation Reform Act of 1995
and which reflect management's expectations about future
conditions, including but not limited to the pending Triumph
Product Support Acquisition. Forward-looking statements often
address our expected future operating and financial performance and
financial condition, or sustainability targets, goals, commitments
and other business plans, and often may also be identified because
they contain words such as "anticipate," "believe," "continue,"
"could," "estimate," "expect," "intend," "likely," "may," "might,"
"plan," "potential," "predict," "project," "seek," "should,"
"target," "will," "would" or similar expressions and the negatives
of those terms.
Factors that may cause actual results to differ
materially from current expectations include, among others, risks
associated with the Company's ability to consummate the Triumph
Product Support Acquisition and the timing of the Triumph Product
Support Acquisition; risks and uncertainties related to general
market conditions and the completion of the proposed senior notes
offering on the anticipated terms, or at all, and the Company's
entry into the proposed amendment to the Revolving Credit Facility;
the Company's ability to successfully integrate the acquired
business; the Company's ability to realize the anticipated benefits
and synergies of the Triumph Product Support Acquisition as rapidly
or to the extent anticipated; risks related to the Company's
ability to obtain any contemplated financing on favorable terms, or
at all; the amount of costs, fees and expenses related to the
Triumph Product Support Acquisition; and other factors that could
affect the Company's business. These forward-looking statements are
based on beliefs of Company management, as well as assumptions and
estimates based on information currently available to the Company,
and are subject to certain risks and uncertainties that could cause
actual results to differ materially from historical results or
those anticipated. For a discussion of these and other risks and
uncertainties, refer to "Risk Factors" in the Company's most recent
Annual Report on Form 10-K and subsequent Quarterly Reports on Form
10-Q, as well as the Company's other subsequent filings with the
Securities and Exchange Commission. Should one or more of these
risks or uncertainties materialize adversely, or should underlying
assumptions or estimates prove incorrect, actual results may vary
materially from those described and the anticipated benefits of the
Triumph Product Support Acquisition may not be realized. These
events and uncertainties are difficult or impossible to predict
accurately and many are beyond the Company's control. The Company
cautions readers not to place undue reliance upon any such
forward-looking statements, which speak only as of the date made.
The Company assumes no obligation to update any forward-looking
statements to reflect events or circumstances after the date of
such statements or to reflect the occurrence of anticipated or
unanticipated events, except as required by law.
Contact:
Dylan Wolin
Vice President, Strategic & Corporate Development and
Treasurer
+1-630-227-2017
dylan.wolin@aarcorp.com
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SOURCE AAR CORP.