Published on 8/14/2023 in the Prospect News Investment Grade Daily.
New Issue: Otis Worldwide sells $750 million 5.25% five-year notes at 98 bps over Treasuries
By Wendy Van Sickle
Columbus, Ohio, Aug. 14 – Otis Worldwide Corp. priced $750 million of 5.25% five-year notes (Baa1/BBB) at 99.64 to yield 5.333%, or 98 basis points over Treasuries, according to an FWP filing with the Securities and Exchange Commission.
The notes will feature an optional make-whole call, followed by a par call option.
A change-of-control triggering event will make the notes putable at 101.
BofA Securities, Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, HSBC Securities (USA) Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and SMBC Nikko Securities America, Inc. are the bookrunners.
Proceeds will be used to repay at maturity the 0% notes due Nov. 12, 2023 issued by subsidiary Highland Holdings Sarl of which €500 million, or approximately $546 million, is outstanding as of June 30. The remainder, if any, will be used to fund the repayment of certain of Otis’ commercial paper borrowings and for other general corporate purposes.
Elevator and escalator maker Otis Worldwide is based in Farmington, Conn.
| Issuer: | Otis Worldwide Corp.
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| Amount: | $750 million
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| Issue: | Notes
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| Maturity: | Aug. 16, 2028
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| Bookrunners: | BofA Securities, Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, HSBC Securities (USA) Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and SMBC Nikko Securities America, Inc.
|
| Senior co-managers: | Barclays, BNP Paribas Securities Corp., Commerz Markets LLC, Deutsche Bank Securities Inc., Intesa Sanpaolo IMI Securities Corp., Loop Capital Markets LLC, Santander US Capital Markets LLC, SG Americas Securities, LLC and UniCredit Capital Markets LLC
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| Co-managers: | Academy Securities, Inc., ICBC Standard Bank plc, Siebert Williams Shank & Co., LLC and Westpac Capital Markets LLC
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| Trustee: | Bank of New York Mellon Trust Co., NA
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| Counsel to issuer: | Wachtell, Lipton, Rosen & Katz
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| Counsel to underwriters: | Fried, Frank, Harris, Shriver & Jacobson LLP
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| Coupon: | 5.25%
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| Price: | 99.64
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| Yield: | 5.333%
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| Spread: | Treasuries plus 98 bps
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| Call features: | Make-whole call before July 16, 2028 at Treasuries plus 15 bps; thereafter at par
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| Change-of-control put: | At 101
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| Trade date: | Aug. 14
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| Settlement date: | Aug. 16
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| Ratings: | Moody’s: Baa1
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| S&P: BBB
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| Distribution: | SEC registered
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| Cusip: | 68902VAP2
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