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Continental Planning Another Eurobond Offering
- Proceeds to be used for partial refinancing of the bond issued in September 2010
- Minimum volume of €500 million targeted
- Further improvement of debt maturity profile
- Eurobond that has been issued in September 2010 to be redeemed early
The international automotive supplier Continental is planning to issue another Eurobond in benchmark size, and intends to use the issue proceeds thereof for the partial refinancing of its bond issued in September 2010. The intention is to issue a bond with a volume of at least €500 million and a term to maturity of five years. The issue volume and bond conditions are expected to be determined in the next few days. "By issuing a new bond to partially refinance the bond issued in September 2010, we will be able to reduce our interest costs significantly and further improve the debt maturity profile at the same time," explained Chief Financial Officer Wolfgang Schäfer.
The bond will be issued under Continental's recently established Debt Issuance Programme and is to be placed with both institutional and private investors. The joint-bookrunners on the transaction are BNP Paribas, Citi, Deutsche Bank, ING and UniCredit. The bond will be issued in denominations of €1,000 and is expected to be listed on the Regulated Market of the Luxembourg Stock Exchange.
In addition Continental calls the 7.5 percent Eurobond with a nominal amount of €1 billion that has been issued in September 2010 by its subsidiary Conti-Gummi Finance B.V. (ISIN DE000A1A0U37) for early redemption. The bond will be terminated early and will be due for repayment on September 16, 2013, i.e. four years prior to the original maturity. The agreed redemption price is 103.75 percent. The respective call notice has been sent to the notes representative and to the clearing system for notification to the bondholders as of today.
Back in 2010, the company, through its subsidiary Conti-Gummi Finance B.V., issued four Eurobonds with different maturities in a total nominal amount of €3 billion. The terms and conditions of all four bonds contain an early redemption option. The first bond with a coupon of 8,5% and a nominal amount of €750 million, issued in July 2010 maturing at July 15, 2015, has been called in May 2013. The early redemption payment of that bond will be made on July 15, 2013.
A decision is yet to be made regarding the two remaining Eurobonds issued in October 2010 which also contain a call right. They can be redeemed on or after October 5, 2013 at the earliest.
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This document has been prepared on the basis that any offer of Notes in any Member State of the European Economic Area ("EEA") which has implemented the Prospectus Directive (2003/71/EC), as amended (each, a "Relevant Member State") will be made pursuant the final terms and the base prospectus prepared by Continental AG or pursuant to an exemption under the Prospectus Directive, as implemented in that Relevant Member State, from the requirement to publish a prospectus for offers of Notes. Accordingly any person making or intending to make any offer in that Relevant Member State of Notes which are the subject of the placement contemplated in this announcement may only do so in circumstances in which no obligation arises for Continental or any other person to publish a prospectus pursuant to Article 3 of the Prospectus Directive (other than the final terms and the base prospectus prepared by Continental AG) or supplement a prospectus pursuant to Article 16 of the Prospectus Directive, in each case, in relation to such offer. Continental has not authorized, nor does it authorize, the making of any offer of Notes in circumstances in which an obligation arises for Continental or any other person to publish or supplement a prospectus (other than the final terms and the base prospectus prepared by Continental AG) for such offer.
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