Herc Holdings announced it intends to offer $1 billion aggregate principal amount of senior unsecured notes due 2027 in a private offering exempt from the registration requirements of the Securities Act of 1933, as amended, subject to market and other conditions. The terms of the notes will be determined at the time of pricing of the notes.
The notes will be senior unsecured obligations of the company and interest will be payable semi-annually in arrears. The notes will be guaranteed on a senior unsecured basis, subject to limited exceptions, by the company’s current and future domestic subsidiaries, including Herc Rentals. The net proceeds from the sale of the notes are expected to be used to redeem all $864.5 million aggregate principal amount of Herc’s outstanding senior secured second priority notes, to partially repay indebtedness outstanding under Herc’s asset-backed revolving credit agreement, and to pay related fees and expenses.
Following the offering, the company expects to refinance the ABL credit facility to, among other things, add Herc Holdings as a borrower, extend the maturity date from 2021 to 2024 and allow the U.S. borrowers to borrow thereunder based on the value of assets owned by Canadian subsidiaries that are included in the borrowing base.
Herc Rentals, Bonita Springs, Fla., is No. 3 on the RER 100.