NORTH CANTON, Ohio - The Timken Company (NYSE: NYSE:TKR), known for its engineered bearings and industrial motion products, has priced an offering of €600 million in senior unsecured notes with a 4.125% interest rate, maturing in 2034. The notes, part of an underwritten public offering, are to be issued at 98.832% of their par value, with the closing anticipated around May 23, 2024, contingent on customary conditions.
Goldman Sachs (NYSE:GS) & Co. LLC and J.P. Morgan Securities plc are the joint book-running managers for this transaction. The proceeds from the sale of the notes are earmarked for the redemption of Timken's existing 3.875% Senior Notes due 2024, including related fees and expenses.
Moreover, the company plans to repay borrowings under its senior unsecured revolving credit facility. Any remaining funds may be used to repay borrowings under its accounts receivable facility or for general corporate purposes.
The offering is being conducted in accordance with an effective shelf registration statement previously filed with the Securities and Exchange Commission (SEC). The relevant prospectus supplement and accompanying prospectus are available through the SEC, with copies also obtainable from the joint book-running managers.
This announcement does not constitute an offer to sell these securities nor a solicitation for purchase in any jurisdiction where such an offer or sale would be unlawful. The press release emphasizes that the notes are not intended for retail investors in the European Economic Area or the United Kingdom, adhering to respective regulations.
The Timken Company has a history spanning 125 years and is recognized for its innovation and customer-centric solutions. In 2023, the company reported sales of $4.8 billion and has a global workforce exceeding 19,000 across 45 countries. Timken has received accolades for its innovation, ethical practices, and commitment to diversity.
The press release includes forward-looking statements subject to market conditions and other factors that could affect the actual results of the offering. The company's SEC filings provide further details on these risks and uncertainties.
This news article is based on a press release statement from The Timken Company.
InvestingPro Insights
The Timken Company's recent move to issue senior unsecured notes comes at a time when the company shows a stable financial outlook, as evidenced by key metrics from InvestingPro. With a market capitalization of $6.39 billion and a P/E ratio that has adjusted to 15.62 over the last twelve months as of Q1 2024, Timken exhibits a solid valuation foundation for investors considering the debt offering.
The company's revenue growth, although modest at 1.33% over the last twelve months, is complemented by a robust gross profit margin of 31.88%, indicating healthy financial management and cost control strategies.
One of the InvestingPro Tips that stands out for Timken is the company's ability to raise its dividend for 10 consecutive years, showcasing its commitment to returning value to shareholders. This is further bolstered by a dividend yield of 1.46% and a dividend growth of 9.68% over the last twelve months as of Q1 2024, signaling confidence in its financial stability and future earnings potential.
Moreover, analysts have revised their earnings upwards for the upcoming period, suggesting that the market anticipates continued financial health for the company. For investors looking for more in-depth analysis and tips, there are 6 additional InvestingPro Tips available at https://www.investing.com/pro/TKR, and using the coupon code PRONEWS24 will provide an extra 10% off a yearly or biyearly Pro and Pro+ subscription.
Despite the recent revenue contraction in Q1 2024, Timken's long-term growth trajectory and financial resilience, as mirrored in the InvestingPro Data, suggest that the company is well-positioned to manage its debt obligations while continuing to innovate and expand its global presence.
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