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"), has successfully
priced its offering of $550 million
aggregate principal amount of 6.750% senior notes due 2029 (the
"Notes"). The offering was upsized to $550 million from the original offering size of
$500 million in aggregate principal
amount of Notes. The Notes will bear interest at a fixed annual
rate of 6.750% and will mature on March 15,
2029. The offering is expected to close on March 1, 2024, subject to customary closing
conditions.
The Company intends to use the net proceeds of the 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 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
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 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.