BILLERICA, Mass. - December 12, 2019 - Bruker Corporation (Nasdaq: BRKR) today announced that it has completed certain debt financing actions intended to enhance its financial flexibility and fund corporate strategic objectives. The actions include: (1) a new 5 year revolving credit facility with expanded capacity to borrow up to $600 million, (2) a new 7 year term loan in the aggregate principal amount of $300 million, together with cross-currency and interest rate swap arrangements which fix rates to Euro and Swiss Franc rates, (3) a new private placement of 10 year senior notes in the aggregate principal amount of 297 million Swiss Franc, and (4) new cross-currency swap arrangements on existing 2012 private placement notes of $205 million which fix rates to Euro and Swiss Franc rates. This debt refinancing capitalizes on the low interest rate environment in domestic and European capital markets, effectively fixes interest rates on approximately 60% of the Company's total borrowing capacity and extends debt maturities out to 2026 and 2029.
Specifically, the Company has entered into the following arrangements:
- Five-year revolving credit facility of up to $600 million (the "2019 Revolving Credit Facility"). The 2019 Revolving Credit Facility replaces the Company's $500 million five-year revolving credit facility established in October 2015, which has been terminated;
- Seven-year term loan in the aggregate principal amount of $300 million (the "Term Loan") on terms substantially similar to the terms of the 2019 Revolving Credit Facility; Floating interest rates under the Term Loan were simultaneously fixed through cross-currency and interest rate swap arrangements into fixed Euro and Swiss Franc rates carrying an average effective interest rate of 0.94%;
- Private placement of 297 million Swiss Franc aggregate principal amount of 1.01% senior notes due December 11, 2029 ("the Notes"). Interest on the Notes is payable semi-annually. The Notes were issued and sold to a limited number of accredited institutional investors in an offering exempt from the registration requirements of the Securities Act of 1933, as amended.
- Cross-currency swaps were also executed on the Company's existing 2012 private placement notes of $105 million and $100 million carrying interest rates of 4.31% and 4.46% respectively, resulting in an average effective interest rate of 2.25% on these instruments
Bruker intends to use proceeds from this financing for general corporate purposes, including the repayment of outstanding borrowings under the Company's prior 2015 revolving credit facility, and to support corporate strategic objectives.
Including the effect of swap arrangements and expected reinvestment, the net impact of these financing transactions is expected to be accretive to EPS in 2020 and beyond.
The new financing arrangements are subject to customary affirmative and negative covenants and other terms as detailed in a filing with the Securities and Exchange Commission on Form 8-K, dated December 11, 2019.
About Bruker Corporation
Bruker is enabling scientists to make breakthrough discoveries and develop new applications that improve the quality of human life. Bruker’s high-performance scientific instruments and high-value analytical and diagnostic solutions enable scientists to explore life and materials at molecular, cellular and microscopic levels. In close cooperation with our customers, Bruker is enabling innovation, improved productivity and customer success in life science molecular research, in applied and pharma applications, in microscopy and nanoanalysis, and in industrial applications, as well as in cell biology, preclinical imaging, clinical phenomics and proteomics research and clinical microbiology.
Forward Looking Statements
Any statements contained in this press release which do not describe historical facts may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding the expected interest cost reduction associated with the financing arrangements and the expected impact of the financing arrangements on EPS. Any forward-looking statements contained herein are based on current expectations, but are subject to risks and uncertainties that could cause actual results to differ materially from those indicated, including, but not limited to, risks and uncertainties relating to adverse changes in conditions in the global economy and volatility in the capital markets, fluctuations in foreign currency exchange rates, our ability to successfully implement and execute on our capital management initiatives, our ability to maintain our leverage and interest coverage ratios required by the financing arrangements, our ability to make payments on our financial obligations when they become due, and other risk factors discussed from time to time in our filings with the Securities and Exchange Commission, or SEC. These and other factors are identified and described in more detail in our filings with the SEC, including, without limitation, our annual report on Form 10-K for the year ended December 31, 2018. We expressly disclaim any intent or obligation to update these forward-looking statements other than as required by law.
Director, Investor Relations & Corporate Development
T: +1 (978) 663-3660 x1479