BorgWarner Announces Cash Tender Offers for its Senior Notes
Rhea-AI Summary
BorgWarner (NYSE: BWA) has launched cash tender offers for certain outstanding senior notes, including an Any and All Offer for its 7.125% Senior Notes due 2029 with $120,685,000 principal outstanding, and separate offers for four additional series of Waterfall Notes.
The Waterfall Offers cover 4.375% 2045, 5.400% 2034, 4.950% 2029 and 2.650% 2027 Notes, with aggregate Tender Consideration for Waterfall Notes capped at $720,000,000 (the Waterfall Cap) and a $250,000,000 Sub Cap on the 2.650% Notes. Tender Consideration per $1,000 will be set using fixed spreads over specific U.S. Treasury reference securities based on yields at 3:00 p.m. New York City time on August 14, 2026, the Price Determination Date. The Tender Offers expire at 5:00 p.m. New York City time on August 14, 2026, with settlement expected on August 18, 2026. Holders whose notes are accepted will receive Tender Consideration plus accrued and unpaid interest. BorgWarner also intends to redeem on September 9, 2026 any 7.125% Notes not purchased in the Any and All Offer at a make-whole redemption price, subject to the 7.125% Notes Indenture.
Positive
- Waterfall Notes repurchase capped at $720,000,000, potentially reducing outstanding debt if fully subscribed
- Any and All Offer for 7.125% 2029 Notes targets higher-coupon debt of $120,685,000 principal
- Make-whole redemption on September 9, 2026 planned for remaining 7.125% Notes, providing clarity on that series’ retirement
- Pricing via fixed spreads over U.S. Treasuries gives transparent, market-based tender consideration for each note series
Negative
- Potential cash outflow up to the $720,000,000 Waterfall Cap plus Any and All purchases may reduce available cash for other uses
- $250,000,000 Sub Cap on 2.650% 2027 Notes limits the maximum principal of that low-coupon series that can be retired
News Explained
BorgWarner has started a conditional debt buyback: potential note retirement and cash use remain unsettled.
The disclosure is at the commenced-offer stage: if tenders are accepted and paid, BorgWarner would retire selected notes for cash, but the release does not commit the company to a purchase yet.
The
Acceptance and payment remain subject to conditions the company may satisfy or waive; there is no minimum tender requirement, and none of the offers depends on completion of another offer.
The Offer to Purchase is the named document that sets out the conditions and procedures determining which tenders are accepted and paid.
Key Figures
Historical Context
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| Aug 05 | Program awards | Positive | +5.9% | New variable cam timing awards included European and Chinese OEM programs. |
| Aug 05 | Earnings report | Positive | +5.9% | Second-quarter results supported higher adjusted EPS guidance and expanded repurchase authorization. |
| Aug 03 | Program extension | Positive | -0.7% | European OEM inverter programs were extended for hybrid and battery-electric applications. |
| Jul 31 | Board appointment | Neutral | -1.0% | Rajesh Kalathur joined BorgWarner's board as an independent director. |
| Jul 31 | Dividend declaration | Positive | -1.0% | The board declared a quarterly cash dividend payable in September. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Positive news had mixed reactions: two Aug 5 events aligned with +5.93%, while three earlier events diverged.
Key Terms
tender consideration financial
make-whole redemption price financial
accrued interest financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
Series of | CUSIP/ISIN | Aggregate | Offer Sub | Acceptance | Maturity | Reference | Bloomberg | Fixed | ||||||||
| 099724 AC0 / | N/A | N/A | February |
| FIT 5 | +25 | |||||||||
| 099724 AH9 / | N/A | 1 | March 15, |
| FIT 1 | +65 | |||||||||
| 099724 AQ9 / | N/A | 2 | August |
| FIT 1 | +40 | |||||||||
| 099724 AP1 / | N/A | 3 | August |
| FIT 1 | +30 | |||||||||
| 099724 AL0 / | 4 | July 1, |
| FIT 3 | +20 |
_________________ | |
(1) | No representation is made as to the correctness or accuracy of the CUSIP or ISIN numbers listed above. |
(2) | The Offer Sub Cap (as defined below) represents the maximum aggregate principal amount of Waterfall Notes of such series to be purchased pursuant to the Offers. |
(3) | Subject to the satisfaction or waiver by the Company of the conditions of the Offers described in the Offer to Purchase, the Company will accept Waterfall Notes for purchase in the order of their respective Acceptance Priority Level specified in this table (each, an "Acceptance Priority Level," with 1 being the highest Acceptance Priority Level and 4 being the lowest Acceptance Priority Level). |
The Tender Offers consist of offers to purchase for cash (i) any and all of the Company's outstanding
On August 10, 2026, the Company intends to deliver to The Bank of New York Mellon ("BNY," as successor in interest to The First National Bank of
The "Tender Consideration" for each Series of Notes payable per each
In addition to the Tender Consideration, all Holders whose Notes are accepted for purchase pursuant to a Tender Offer will, on the Settlement Date, also receive accrued and unpaid interest on those Notes from the last interest payment date with respect to those Notes to, but excluding, the Settlement Date (the "Accrued Interest," and the payment thereof, the "Accrued Interest Payment").
The Tender Offers will expire at 5:00 p.m.,
The "Settlement Date" will be the second business day after the Expiration Date and is expected to be August 18, 2026.
The Company's obligation to accept for purchase and to pay for Notes of each series validly tendered and not validly withdrawn pursuant to the Tender Offers is subject to the satisfaction or waiver, in the Company's discretion, of certain conditions, which are more fully described in the Offer to Purchase. If any condition is not satisfied, the Company is not obligated to accept for payment, purchase or pay for, and may delay the acceptance for payment of, any tendered Notes, in each case subject to applicable law, and may terminate or alter any or all of the Tender Offers. Subject to applicable law, the Company reserves the right to (i) waive any and all conditions to the any or all of the Tender Offers, (ii) extend or terminate the Any and All Offer or the Offers, including the Expiration Date, or (iii) otherwise amend any of the Tender Offers. The Tender Offers are not contingent upon the tender of any aggregate minimum principal amount of Notes of any Series (subject to minimum denomination requirements as set forth in the Offer to Purchase), and none of the Tender Offers is conditioned on the consummation of any of the other Tender Offers by the Company. The complete terms and conditions of the Tender Offers are set forth in the Tender Offer Documents. Holders of Notes are urged to read the Tender Offer Documents carefully.
Information Relating to the Tender Offers
The Offer to Purchase is being distributed to holders beginning today. Barclays Capital Inc. and PNC Capital Markets LLC are the dealer managers for the Tender Offers. Investors with questions regarding the Tender Offers may contact Barclays Capital Inc. at (212) 528-7581 or toll-free at (800) 438-3242, or email us.lm@barclays.com, or PNC Capital Markets LLC at (212) 878-8946 or toll-free at (833) 715-3537, or email liabilitymanagement@pnc.com. Global Bondholder Services Corporation is the tender and information agent for the Tender Offers and can be contacted at (212) 430-3774 or toll-free at (855) 654-2015. The Offer to Purchase may be accessed at the following web address: https://www.gbsc-usa.com/borgwarner/.
Holders of Notes are advised to check with each bank, securities broker or other intermediary through which they hold Notes as to when such intermediary would need to receive instructions from a beneficial owner in order for that Holder to be able to participate in, or withdraw their instruction to participate in the Offers before the deadlines specified herein and in the Offer to Purchase. The deadlines set by any such intermediary and The Depositary Trust Company for the submission and withdrawal of tender instructions may be earlier than the relevant deadlines specified herein and in the Offer to Purchase.
None of the Company, the dealer managers, the tender and information agent, the trustees or any of their respective directors, officers, employees or affiliates makes any recommendation as to whether holders should tender Notes of a series in response to the Tender Offers. Each holder must make his, her or its own decision as to whether to tender Notes and, if so, as to what principal amount of Notes to tender.
This press release shall not constitute an offer to sell, a solicitation to buy or an offer to purchase or sell any securities. The Tender Offers are being made only pursuant to the Offer to Purchase and only to such persons and in such jurisdictions as is permitted under applicable law.
About BorgWarner
For more than 130 years, BorgWarner has been a transformative global product leader bringing successful mobility innovation to market. With a focus on sustainability, we're helping to build a cleaner, healthier, safer future for all.
Forward-Looking Statements
This release may contain forward-looking statements as contemplated by the 1995 Private Securities Litigation Reform Act that are based on management's current outlook, expectations, estimates and projections. Words such as "anticipates," "believes," "continues," "could," "designed," "effect," "estimates," "evaluates," "expects," "forecasts," "goal," "guidance," "initiative," "intends," "may," "outlook," "plans," "potential," "predicts," "project," "pursue," "seek," "should," "target," "when," "will," "would," and variations of such words and similar expressions are intended to identify such forward-looking statements. Further, all statements, other than statements of historical fact, contained or incorporated by reference in this release that we expect or anticipate will or may occur in the future regarding our financial position, including our guidance for full year 2026, our business strategy and measures to implement that strategy, including changes to operations, competitive strengths, goals, expansion and profitable growth of our business and operations, plans, references to future success, including the anticipated benefits of our new business awards and other such matters, are forward looking statements. Accounting estimates, such as those described under the heading "Critical Accounting Policies and Estimates" in Item 7 of our most recently filed Annual Report on Form 10-K ("Form 10-K"), are inherently forward-looking. All forward-looking statements are based on assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. Forward-looking statements are not guarantees of performance, and the Company's actual results may differ materially from those expressed, projected or implied in or by the forward-looking statements.
You should not place undue reliance on these forward-looking statements, which speak only as of the date of this release. Forward-looking statements are subject to risks and uncertainties, many of which are difficult to predict and generally beyond our control, that could cause actual results to differ materially from those expressed, projected or implied in or by the forward-looking statements. These risks and uncertainties, among others, include: the success of our portfolio strategy; supply disruptions impacting us or our customers, commodity availability and pricing and an inability to achieve expected levels of recoverability in commercial negotiations with customers concerning these costs; conditions in the automotive industry; competitive challenges from existing and new competitors, including original equipment manufacturer ("OEM") customers; the challenges associated with rapidly changing technologies, including artificial intelligence, and our ability to innovate in response; the difficulty in forecasting demand for electric vehicles and our electric vehicles revenue growth; potential future changes in laws and regulations, including, by way of example, taxes and tariffs, in the countries in which we operate; potential disruptions in the global economy caused by wars or other geopolitical conflicts; the ability to identify targets and consummate acquisitions on acceptable terms; failure to realize the expected benefits of acquisitions on a timely basis; the possibility that our 2023 tax-free spin-off of our former Fuel Systems and Aftermarket segments into a separate publicly traded company will not achieve its intended tax benefits; the failure to promptly and effectively integrate acquired businesses; the potential for unknown or inestimable liabilities relating to the acquired businesses; impacts of our exit of the charging business; our dependence on automotive and truck production, which is highly cyclical and subject to disruptions; our reliance on major OEM customers; impacts of any future strikes involving any of our OEM customers and any actions such OEM customers take in response; fluctuations in interest rates and foreign currency exchange rates; our dependence on information systems; the uncertainty of the global economic environment; the uncertainty surrounding global trade policies, including tariffs and export restrictions and their impact on the Company, its customers and its suppliers; the outcome of existing or any future legal proceedings, including litigation with respect to various claims, or governmental investigations, including related litigation; impacts from any potential future acquisition or disposition transactions; and the other risks discussed in reports that we file with the Securities and Exchange Commission, including in Item 1A. "Risk Factors" in our most recently filed Annual Report on Form 10-K and/or Quarterly Report on Form 10-Q. We do not undertake any obligation to update or announce publicly any updates to or revisions to any of the forward-looking statements in this release to reflect any change in our expectations or any change in events, conditions, circumstances, or assumptions underlying the statements.
View original content to download multimedia:https://www.prnewswire.com/news-releases/borgwarner-announces-cash-tender-offers-for-its-senior-notes-302847087.html
SOURCE BorgWarner