GREENWICH, Conn. - GXO Logistics, Inc. (NYSE: GXO), a global leader in contract logistics, announced the pricing of $1.1 billion in senior notes in a public offering aimed at financing its acquisition of Wincanton plc, among other corporate purposes. The two tranches of debt, $600 million due 2029 and $500 million due 2034, are set to close on May 6, 2024, with interest rates of 6.250% and 6.500% per annum, respectively.
The 2029 notes will mature on May 6, 2029, and the 2034 notes on May 6, 2034, with semiannual interest payments commencing on November 6, 2024. This strategic financial move is designed to support the company's pending purchase of Wincanton, a logistics firm, and to manage other debt obligations. The offering's completion is not contingent upon the finalization of the Wincanton acquisition.
GXO has expressed that the proceeds from the note offerings will also cover the redemption, repayment, prepayment, or discharge of the company and its subsidiaries' existing debts, as well as general corporate expenses. The notes were offered under a shelf registration statement filed with the U.S. Securities and Exchange Commission (SEC) and declared effective as of August 31, 2021.
The company, which prides itself on its extensive logistics network and technological solutions, serves numerous blue-chip companies worldwide. GXO's announcement comes at a time when the logistics sector is experiencing rapid growth, fueled by the surge in e-commerce and the increasing trend of outsourcing supply chain management.
Investors interested in the notes offering can obtain copies of the prospectus and related preliminary prospectus supplement from the SEC's website or directly from the investment banks managing the sale, BofA Securities, Inc. and Goldman Sachs (NYSE:GS) & Co. LLC.
This press release is intended for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any securities. The sale of these securities will not be lawful in any jurisdiction where such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of that state or jurisdiction.
The information provided in this article is based on a press release statement from GXO Logistics.
InvestingPro Insights
As GXO Logistics (NYSE: GXO) positions itself for strategic growth through the acquisition of Wincanton plc, investors are closely monitoring the company's financial health and market performance.
According to InvestingPro data, GXO currently has a market capitalization of approximately $5.86 billion USD. The company's P/E ratio stands at 28, while the adjusted P/E ratio for the last twelve months as of Q4 2023 is slightly lower at 21.63, reflecting a more favorable valuation when considering the company's earnings during that period.
With a revenue growth of 8.73% over the last twelve months as of Q4 2023, GXO demonstrates its ability to expand its financial top line amidst a dynamic logistics market. The gross profit margin during the same period is reported at 17.83%, indicating a solid profitability from its operations. Still, it is worth noting that analysts have flagged the stock's volatility and its trading near a 52-week low, which could be of concern to risk-averse investors.
For those considering GXO's potential as an investment, two InvestingPro Tips provide additional context: analysts have recently revised their earnings expectations downwards for the upcoming period, and the stock is trading at a high P/E ratio relative to near-term earnings growth. Despite these concerns, analysts predict the company will be profitable this year, and it has been profitable over the last twelve months.
Investors seeking more comprehensive analysis and additional InvestingPro Tips can explore further insights on https://www.investing.com/pro/GXO. There are currently 7 additional tips available, which could help in making a more informed investment decision. To access these insights, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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