In selling Opel to PSA Groupe, General Motors will pay its €3.0 billion pension liabilities by issuing $3 billion of unsecured notes (debt). That much we knew as of yesterday. Now, we know the specific details of the debt instrument that the company will use to raise the funds.
Specifically, General Motors has priced four series of senior unsecured notes for a total of $3.0 billion. These notes include:
- $0.5 billion of floating rate notes due in 2020
- $0.75 billion of 4.20 percent notes due in 2027
- $1.0 billion of 5.15 percent notes due in 2038, and
- $0.75 billion of 5.40 percent notes due in 2048
The offering is expected to settle on August 7th, 2017.
According to a company statement, “GM intends to use the net proceeds from the sale of the notes to fund payments related to certain European pension obligations that were a condition to closing the Opel/Vauxhall sale and for general corporate purposes.”
In addition, GM has filed a registration statement, including a prospectus and preliminary prospectus supplement, with the SEC for the four offering in question.