Winnebago Industries, Inc. Announces Upsize and Early Results for Cash Tender Offer for 6.25% Senior Secured Notes Due 2028

Rhea-AI Summary

Winnebago Industries (NYSE: WGO) has announced the early results of its cash tender offer for its 6.250% Senior Secured Notes due 2028 and increased the maximum purchase amount from $75 million to $100 million. As of February 14, 2025, $243,886,000 in aggregate principal amount (81.30% of outstanding notes) had been validly tendered.

The company will settle early on February 20, 2025, for notes validly tendered by the Early Tender Date. Due to oversubscription, notes tendered after the Early Tender Date won't be accepted, and previously tendered notes will be prorated. The total consideration is $1,005.00 per $1,000 principal amount, plus accrued and unpaid interest.

Positive

• Successful tender offer with high participation rate (81.30% of outstanding notes tendered)
• Increased tender offer capacity from $75M to $100M shows strong financial position
• Early settlement demonstrates efficient capital management

Negative

• High interest rate (6.25%) on existing notes indicates relatively expensive debt
• Oversubscription suggests some noteholders will not be able to participate fully

Insights

Fixed Income Analyst

The robust 81.3% participation rate in Winnebago's tender offer, with $243.9 million tendered against a $100 million cap, reveals strong noteholder confidence in receiving better returns elsewhere, given current market rates. The company's decision to upsize the tender from $75 million to $100 million demonstrates strategic financial management, particularly considering the original $300 million notes carried a relatively high 6.25% coupon.

The tender price of $1,005 per $1,000 principal represents a modest premium, suggesting efficient execution in the current interest rate environment. This transaction will reduce Winnebago's annual interest expense by approximately $6.25 million on the tendered amount, improving free cash flow and financial flexibility. The remaining $200 million in notes maintains adequate liquidity while optimizing the capital structure.

This liability management exercise indicates proactive financial stewardship, particularly valuable in the cyclical RV industry where maintaining financial flexibility is crucial. The strong tender participation also suggests investors anticipate potential interest rate cuts, making the 6.25% notes less attractive to hold at current prices. For Winnebago, this transaction strengthens its balance sheet by reducing high-cost debt while maintaining strategic flexibility for future opportunities or challenges in the outdoor recreation market.

EDEN PRAIRIE, Minn., Feb. 18, 2025 (GLOBE NEWSWIRE) -- Winnebago Industries, Inc. (NYSE: WGO) (the “Company”), a leading manufacturer of outdoor recreation products, today announced early results of its previously announced cash tender offer (the “Tender Offer”) to purchase its 6.250% Senior Secured Notes due 2028 (CUSIP No. 974637AC4 / U9701TAA4) (the “Notes”) and that it is amending the Tender Offer by increasing the maximum aggregate principal amount of Notes it will purchase from $75,000,000 to $100,000,000, exclusive of any applicable premiums paid in connection with the Tender Offer and accrued and unpaid interest. The terms and conditions of the Tender Offer are set forth in an Offer to Purchase dated February 3, 2025 (the “Offer to Purchase”), which was sent to all registered holders (collectively, the “Holders”) of Notes.

As of 5:00 p.m., New York City time, on February 14, 2025 (such date and time, the “Early Tender Date”), according to information provided by D.F. King & Co., Inc., the Tender and Information agent for the Tender Offer, $243,886,000 aggregate principal amount of Notes has been validly tendered and not validly withdrawn as shown in the table below. Withdrawal rights for the Notes expired at 5:00 p.m., New York City time, on February 14, 2025.

Title of Security

Issuer

CUSIP Numbers(1)

Principal Amount Outstanding

Tender Cap

Aggregate Principal Amount Tendered at Early Tender Date

Percentage of Outstanding Notes Tendered

Total Consideration(2)(3)

Aggregate Principal Amount Accepted for Purchase

6.250% Senior Secured Notes due 2028

Winnebago Industries, Inc.

974637AC4/ U9701TAA4

$300,000,000

$100,000,000

$243,886,000

81.30%

$1,005.00

$100,000,000

(1) No representation is made as to the correctness or accuracy of the CUSIP numbers listed in this press release, the Offer to Purchase or printed on the Notes. They are provided solely for the convenience of Holders of the Notes.

(2) Per $1,000 principal amount of Notes.

(3) Excludes Accrued Interest, which will be paid in addition to the Base Consideration or the Total Consideration, as applicable.

Since the aggregate principal amount of the Notes validly tendered and not validly withdrawn at or prior to the Early Tender Date exceeds the Tender Cap, Notes tendered after the Early Tender Date will not be accepted for purchase and the principal amount of the Notes accepted for purchase were prorated, on the terms and subject to the conditions of the Tender Offer.

With respect to Notes validly tendered and not validly withdrawn at or prior to the Early Tender Date and accepted for purchase by the Company, the Company has elected to have an early settlement date to make payment on such Notes on February 20, 2025 (the “Early Settlement Date”). Holders of such Notes will also receive accrued and unpaid interest to, but excluding, the Early Settlement Date.

This press release is for informational purposes only, and is neither an offer to purchase nor a solicitation of an offer to sell any Notes. The Tender Offer is made only by, and pursuant to the terms of, the Offer to Purchase, and the information in this press release is qualified by reference to the Offer to Purchase.

J.P. Morgan Securities LLC is the Dealer Manager for the Tender Offer. Persons with questions regarding the Tender Offer should contact J.P. Morgan Securities LLC at (866) 834-4666 (toll-free) or (212) 834-4818 (collect). Requests for copies of the Offer to Purchase should be directed to D.F. King & Co., Inc., the Tender and Information Agent for the Tender Offer, at (212) 269-5550 (banks and brokers), (800) 848-2998 (toll-free) or email at winnebago@dfking.com.

About Winnebago Industries, Inc.
Winnebago Industries, Inc. is a leading North American manufacturer of outdoor lifestyle products under the Winnebago, Grand Design, Chris-Craft, Newmar and Barletta Boat brands, which are used primarily in leisure travel and outdoor recreation activities. The Company builds high-quality motorhomes, travel trailers, fifth-wheel products, outboard and sterndrive powerboats, pontoons, and commercial community outreach vehicles. Committed to advancing sustainable innovation and leveraging vertical integration in key component areas, Winnebago Industries has multiple facilities in Iowa, Indiana, Minnesota, and Florida. The Company’s common stock is listed on the New York Stock Exchange and traded under the symbol WGO.

Forward-Looking Statements
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that forward-looking statements are inherently uncertain. A number of factors could cause actual results to differ materially from these statements, including, but not limited to risks relating to general economic uncertainty in key markets and a worsening of domestic and global economic conditions or low levels of economic growth; availability of financing for RV and marine dealers and retail purchasers; competition and new product introductions by competitors; ability to innovate and commercialize new products; ability to manage the Company’s inventory to meet demand; risk related to cyclicality and seasonality of the Company’s business; risk related to independent dealers; risk related to dealer consolidation or the loss of a significant dealer; significant increase in repurchase obligations; ability to retain relationships with the Company’s suppliers and obtain components; business or production disruptions; inadequate management of dealer inventory levels; increased material and component costs, including availability and price of fuel and other raw materials; ability to integrate mergers and acquisitions; ability to attract and retain qualified personnel and changes in market compensation rates; exposure to warranty claims and product recalls; ability to protect the Company’s information technology systems from data security, cyberattacks, and network disruption risks and the ability to successfully upgrade and evolve the Company’s information technology systems; ability to retain brand reputation and related exposure to product liability claims; governmental regulation, including for climate change; increased attention to environmental, social, and governance matters, and the Company’s ability to meet its commitments; impairment of goodwill and trade names; risks related to the Company’s outstanding convertible notes and senior secured notes, including the Company’s ability to satisfy its obligations under such notes; changes in recommendations or a withdrawal of coverage by third party security analysts; and other risks and uncertainties as may be described in the Company’s filings with the U.S. Securities and Exchange Commission (the “SEC”). These forward-looking statements should be considered in light of the discussion of risks and uncertainties described under the heading “Risk Factors” contained in the Company’s most recent annual report on Form 10-K, as well as any amendments to such filings, and in other filings with the SEC. The Company disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained in this release or to reflect any changes in the Company's expectations after the date of this release or any change in events, conditions or circumstances on which any statement is based, except as required by law.

Contacts
Investors: Ray Posadas
ir@winnebagoind.com

Media: Dan Sullivan
media@winnebagoind.com

FAQ

What is the total amount of WGO's tender offer for its 2028 Notes?

Winnebago Industries increased its tender offer from $75 million to $100 million for its 6.250% Senior Secured Notes due 2028.

What percentage of WGO's 2028 Notes were tendered by the Early Tender Date?

81.30% of the outstanding notes, representing $243,886,000 in aggregate principal amount, were tendered by February 14, 2025.

What is the total consideration WGO is paying for each $1,000 of 2028 Notes?

WGO is paying $1,005.00 per $1,000 principal amount of notes, plus accrued and unpaid interest.

When is WGO's early settlement date for the tendered 2028 Notes?

The early settlement date is February 20, 2025, for notes validly tendered by the Early Tender Date.

Will WGO accept notes tendered after the Early Tender Date?

No, due to oversubscription, notes tendered after the Early Tender Date will not be accepted for purchase.