Pricing of CNH Industrial Capital LLC $500 million notes

Rhea-AI Summary

CNH Industrial N.V. (NYSE: CNH) announced that its subsidiary, CNH Industrial Capital , has priced $500 million in 4.500% notes due 2027, with an issue price of 99.809%. The offering is expected to close on October 9, 2024. The notes will pay interest semi-annually and mature on October 8, 2027. They are guaranteed by CNH Industrial Capital America and New Holland Credit Company,

The net proceeds will be used for working capital, general corporate purposes, and potentially repaying indebtedness. Several financial institutions are acting as joint book-running managers for the offering. The offering is made pursuant to an effective shelf registration statement filed with the SEC on March 14, 2022.

CNH Industrial Capital , headquartered in Racine, Wisconsin, is a captive finance company primarily supporting CNH Industrial North America's agricultural and construction equipment sales through various financing products and services.

Positive

• Successful pricing of $500 million in notes, indicating strong market demand
• Potential to strengthen working capital and improve financial flexibility
• Opportunity to refinance existing debt at potentially favorable terms

Negative

• Increase in long-term debt obligations
• Additional interest expenses may impact future profitability

Insights

Financial Analyst

CNH Industrial Capital 's pricing of $500 million in 4.500% notes due 2027 is a significant financial move. The 4.5% interest rate is relatively attractive in the current market, suggesting strong investor confidence in the company's creditworthiness. This debt issuance will provide substantial liquidity for working capital and general corporate purposes, including potential receivables purchases.

The notes' investment-grade status, backed by guarantees from two wholly-owned subsidiaries, enhances their appeal to institutional investors. This could lead to lower borrowing costs for future debt issuances. The semi-annual interest payments and 3-year maturity offer a balanced approach to debt management.

For investors, this move indicates CNH Industrial's proactive approach to capital management and its ability to access debt markets on favorable terms. It also suggests potential growth in the company's financing operations, which could positively impact overall financial performance in the agricultural and construction equipment sectors.

Market Research Analyst

This debt offering by CNH Industrial Capital is strategically timed and structured. The $500 million size is substantial, indicating a significant capital raise that could fuel expansion in their financing operations. The 4.5% coupon rate is competitive, reflecting both the company's credit quality and current market conditions.

The use of proceeds for "working capital and other general corporate purposes" provides financial flexibility, potentially allowing CNH to capitalize on market opportunities or weather economic uncertainties. The option to repay existing debt also suggests prudent liability management.

For the broader market, this successful offering may signal continued appetite for corporate debt, especially from companies with strong ties to the real economy. It could encourage other firms in the industrial and financial sectors to tap the bond markets, potentially leading to increased corporate activity and liquidity in the debt markets.

Basildon, October 7, 2024

CNH Industrial N.V. (NYSE:t CNH) today announced that its wholly owned subsidiary, CNH Industrial Capital LLC, has priced $500 million in aggregate principal amount of 4.500% notes due 2027, with an issue price of 99.809%. The offering is expected to close on October 9, 2024, subject to the satisfaction of customary closing conditions.

CNH Industrial Capital LLC intends to add the net proceeds from the offering to its general funds and use them for working capital and other general corporate purposes, including, among other things, the purchase of receivables or other assets in the ordinary course of business. The net proceeds may also be applied to repay CNH Industrial Capital LLC’s indebtedness as it becomes due.

The notes, which are senior unsecured obligations of CNH Industrial Capital LLC, will pay interest semi-annually on April 8 and October 8 of each year, beginning on April 8, 2025, and will be guaranteed by CNH Industrial Capital America LLC and New Holland Credit Company, LLC, each a wholly owned subsidiary of CNH Industrial Capital LLC. The notes will mature on October 8, 2027.

Barclays Capital Inc., Goldman Sachs & Co. LLC, Santander US Capital Markets LLC and SG Americas Securities, LLC are acting as joint book-running managers and the representatives of the underwriters for the offering, and BBVA Securities Inc., SMBC Nikko Securities America, Inc., Intesa Sanpaolo IMI Securities Corp. and UniCredit Capital Markets LLC are acting as joint book-running managers for the offering. The offering is being made pursuant to an effective shelf registration statement filed with the U.S. Securities and Exchange Commission on March 14, 2022. Copies of the prospectus supplement and the accompanying prospectus for the offering may be obtained by contacting Barclays Capital Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, Telephone: 1-888-603-5847, Email: barclaysprospectus@broadridge.com; Goldman Sachs & Co. LLC, 200 West Street, New York, NY 10282, Attn: Prospectus Department, Telephone: 1-866-471-2526, Email: prospectus-ny@ny.email.gs.com; Santander US Capital Markets LLC, 437 Madison Avenue, New York, NY 10022, Telephone: 1-855-403-3636, Email: DCMAmericas@santander.us; or SG Americas Securities, LLC, 245 Park Avenue, New York, NY 10167. Copies of the prospectus supplement and the accompanying prospectus for the offering are also available on the website of the U.S. Securities and Exchange Commission at http://www.sec.gov.

***

This press release does not constitute an offer to sell or a solicitation of an offer to buy any of these securities, nor shall there be any sale of these securities, in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful.

CNH Industrial Capital LLC is an indirect wholly owned subsidiary of CNH Industrial N.V. and is headquartered in Racine, Wisconsin. As a captive finance company, the primary business of CNH Industrial Capital LLC and its subsidiaries is to underwrite and manage financing products for end-use customers and dealers of CNH Industrial America LLC and CNH Industrial Canada Ltd. (collectively, “CNH Industrial North America”) and provide other related financial products and services to support the sale of agricultural and construction equipment sold by CNH Industrial North America. CNH Industrial Capital LLC and its subsidiaries also provide wholesale and retail financing related to new and used agricultural and construction equipment manufactured by entities other than CNH Industrial North America. CNH Industrial Capital LLC’s principal executive offices are located at 5729 Washington Avenue, Racine, WI 53406, and the telephone number is +1(262) 636-6011.

Contacts:

Media Relations
Email: mediarelations@cnh.com

Investor Relations
Email: investor.relations@cnh.com

Attachment

• 20241007_PR_CNH_Industrial_Capital_Pricing

FAQ

What is the interest rate and maturity date for CNH Industrial Capital 's new notes?

CNH Industrial Capital 's new notes have an interest rate of 4.500% and will mature on October 8, 2027.

How much did CNH Industrial Capital (NYSE: CNHI) raise in the notes offering?

CNH Industrial Capital raised $500 million in aggregate principal amount through the notes offering.

What will CNH Industrial Capital use the proceeds from the notes offering for?

The net proceeds will be used for working capital, general corporate purposes, including the purchase of receivables or other assets, and potentially repaying existing indebtedness.

When is the expected closing date for CNH Industrial Capital 's notes offering?

The notes offering is expected to close on October 9, 2024, subject to customary closing conditions.