Spectrum Brands Announces $300M Offering

Spectrum Brands Holdings, Inc. (NYSE: SPB) has announced its proposed offering of $300 million in aggregate principal amount of exchangeable senior notes due 2029, alongside a share repurchase plan. The company intends to utilize a portion of the net proceeds from the offering to fund the cost of entering into capped call transactions and for general corporate purposes. Additionally, Spectrum Brands, Inc., a wholly-owned subsidiary, plans to repurchase up to $100 million of shares of common stock of the parent company concurrently with the pricing of the exchangeable notes in privately negotiated transactions.

The exchangeable notes will accrue interest payable semi-annually in arrears and will mature on June 1, 2029, unless repurchased, redeemed, or exchanged in accordance with their terms prior to such date. Holders of the exchangeable notes will have the right to require the company to repurchase all or a portion of their exchangeable notes at 100% of their principal amount, plus any accrued and unpaid interest, upon the occurrence of certain corporate events constituting a "fundamental change" as defined in the indenture governing the exchangeable notes.

In connection with the pricing of the exchangeable notes, the company expects to enter into share repurchases at a cash purchase price per share equal to the closing price per share of the parent common stock on the pricing date of the exchangeable notes. Additionally, the company anticipates entering into privately negotiated capped call transactions with one or more of the initial purchasers or their affiliates and/or other financial institutions. The capped call transactions are expected to reduce the potential dilution to parent common stock upon any exchange of the exchangeable notes and/or offset any potential cash payments the company is required to make in excess of the principal amount of exchanged notes, as the case may be.

Furthermore, the company announced that its board of directors has authorized a new $500 million parent common stock repurchase program, with up to $100 million intended to be used to purchase shares of parent common stock concurrently with the pricing of the offering of the exchangeable notes in privately negotiated transactions effected through one of the initial purchasers and/or its affiliates.

Spectrum Brands Holdings, Inc. is a home-essentials company focusing on delivering innovative products and solutions to consumers for use in and around the home through its trusted brands, including Tetra, Nature's Miracle, George Foreman, Black + Decker, and Copper Chef, among others. The market has reacted to these announcements by moving the company's shares 0.1% to a price of $92.17. If you want to know more, read the company's complete 8-K report here.

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